It is not difficult to find lenders these days that are open to accommodating the needs of bad credit borrowers. The rise of the online lender has meant that more affordable loans are on offer than before. Even applicants seeking unsecured personal loans with bad credit have a realistic chance of getting their application approved.
But the challenge is to find a lender willing to grant a loan quickly without the need for any kind of security. Unsecured loans are usually more difficult to get approval on anyway, but getting fast loan approval with no collateral and with poor credit ratings is something of a triple whammy.
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But there are unsecured personal loans that are within reach of bad credit borrowers, and can be granted and transferred into a bank account as quickly as 24 hours after submitting the application.
Advantages of Collateral Free Borrowing
There is certainly truth in the statement that loans without collateral are more difficult to secure. The reason is that the lender has no source of compensation should the loan be defaulted upon. So, when seeking unsecured personal loans with bad credit, applicants need to be clever.
But there are advantages to seeking loans without putting up any form of security. For a start, no possession of value needs to be placed at risk in the transaction. Usually, the security is taken by the lender in the event the borrower defaults on the loan.
Logically, the chances of getting fast loan approval in this circumstance are minimal, with most lenders wanting to check out the credit history of bad credit borrowers seeking unsecured personal loans. However, the borrower does not stand to lose anything more, so are limiting their own losses.
Online Lenders Make Applying Easier
In the modern lending world, the old financial institutions are not the preferred option amongst consumers. Increasingly, it is the online lenders that are winning out. This is certainly true for those seeking unsecured personal loans with bad credit.
Lower overheads means they can afford to charge lower interest rates, while their open attitude towards bad credit borrowers means their loan products are better suited to the needs of that niche market. And because everything can be done online, fast loan approval is practically guaranteed. In fact, approval can be received within minutes in some cases.
These lenders have some basic criteria, of course. For example, applicants must be full-time employed with a minimum 3 months in their current position. They must also have a bank account, so that the unsecured personal loan can be transferred to their account, and repayments withdrawn directly from it each month.
Other Factors To Consider
The conditions laid down by lenders are always the same, with applicants needing to be over 18 and have US citizenship or legal residency. As mentioned above, a bank account is needed but if the applicant has not got one, some lenders will ask for post-dated checks from those seeking unsecured personal loans with bad credit.
It is also becoming common practice for online lenders to issue a prepaid debit card to successful applicants. This means the funds are easier to manage, and repayments can be paid onto the card. What is more, the card can be used for future loan approvals too.
Fast loan approval is a major advantage of online lenders, but it is the simple access to unsecured personal loans that ensure their growing popularity.
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