Unemployment has plagued many parts of the world because of a global recession that’s being experienced by every country and economy. There’s a significant rise in the unemployment rate in the last few years and this affects a lot of people. Being unemployed can be a very hard situation for those who wish to apply for loans on credit, because they immediately fall under the category “high risk borrowers”. Therefore, these types of people tend to look for companies who offer bad credit loans – those loans which are offered even to those who have a history of bad credit or to those who are currently unemployed. But they may not be easy to find. And even though there are companies that offer bad credit loans, you have to take note that you’ll be obliged to pay higher interest rates and often it grows even higher the longer you wait to pay off the debt.
You can still acquire secured loans, if you have something to offer as collateral like a house, a car, jewelry, etc. Secured loans are easier to look for unlike unsecured loans as the lender will have the confidence that if you can’t pay your debt in full and on time, they can seize your collateral. However, the loan amount tends to be dependant upon the type of collateral you offer (e.g. fine jewelry, your house, etc.).
There are a lot of things to know about bad credit loans. Some of them are:
- Bad credit loans can be hard to find, especially unsecured ones
- They tend to have higher interest rates
- A lot of online scammers are offering loans that are very easy to get, even to those who possess a very bad credit score
What are the things to consider before applying for bad credit loans online?
In Canada, there are a lot of online bad credit lenders and a lot of them offer almost no verification process. They often advertise things such as “There will be no need to check your credit score.” (Perhaps, of course, they know that they cater mostly to those who possess bad credit scores and unemployed people). But beware as there are lot’s of online scammers, especially in this kind of high reward business. Here are some tips to consider before applying to anyone who offers bad credit loans for the unemployed, online:
- Consider those websites with extension of .ca which means that the domain is registered with the official domain extension of Canada. That means that they cater mostly or only to Canadians and will result in faster transactions and more stable customer support.
- Beware of websites that offer things that are too good to be true like the 60 minute approval time. There’s no such thing as that.
- Also avoid those which offer unsecured loans with very low interest rates. Consider the interest rate of about 10% as the ideal rate for an unsecured bad credit loan.
- It’s a good habit to consult banks about the places that they refer to, to lend money to those who have bad credit scores. They’re always a reliable source.
If you found a reliable source for a bad credit lender, don’t forget that you now have a serious responsibility. To make sure that there will be no any hassles, remember the following:
- Make sure that you get only what you can pay
- Read the terms and agreement if any
- Make sure that you arrange your repayment terms in the shortest time possible to improve your credit score and to save yourself from many hassles, like a seemingly never ending debt
- The longer your repayment term is, the more interest you’ll have to pay
- Make sure you can pay on time or earlier. This way, you will be able to acquire lower interest rates for your future lending needs
Even though you have a bad credit score and are unemployed, you can still achieve a bad credit loan with many lending institutions. Just make sure that you are responsible enough to pay for your obligations, so that the next time you need help, everything will run smoothly.