Guaranteed Bad Credit Loans

The economic recession has played havoc on most people's credit scores, with job loss and pay cuts being the norm for the day. People are scrambling to get in touch with financial institutes that offer guaranteed bad credit loans. Although the economic stimulus package announced by the Obama administration has been able to cushion the downward spiral of the economy, it hasn't had far-reaching consequences as yet. There are many families struggling with bad credit and in need of financial assistance to deal with their basic requirements.

Situations which require a financial solution have a habit of coming unannounced, and if you have bad credit it is difficult to get your hands on cash. Traditional lending institutes like banks will simply reject your loan application if you have a poor credit history. The only option in such cases is to opt for high interest bad credit loans.

Payday Loans
Payday loans are one of the best options for getting guaranteed loans for people with bad credit. These are also known as cash advance loans as they are given against your next paycheck. The amount you can get on such unsecured loans is quite low with many organizations setting a limit of USD 1,500. However, there are institutes who will give more depending upon the paperwork. To qualify for a payday loan you will need to show income proof and residential address proof.

This personal loan is a cash advance loan on your next paycheck and therefore the duration of the loan is also less. Nowadays you can even apply for a no fax payday loan online. You can get approved for a loan with bad credit within 24-48 hours of application. The interest rates on such kind of unsecured loans are very high, at around 20-30 percent.

Secured Loans
These types of loans are secured as the lender gives you money against your asset. Due to this the interest rate on such loans is lesser than payday loans and many people opt for such loans. The loan amount on such secured loans can also be high depending on the value of the collateral. Time duration of the loan will also be high therefore making it considerably easier to repay the loan. Collateral loans or secured loans are used by individuals who want to improve their credit score by paying their installments on time. There could be various other reasons why people go in for loans, for example medical emergencies, school tuition, etc. The only thing you need to remember when you are looking for bad credit loans is to shop around. There are several sites on the Internet that offer bad credit loans, pick an institute that offers the terms that you are looking for.

You need to research carefully before jumping into a contract. Many websites use ambiguous terms like less interest rate and do not indicate clearly the annual percentage rate on the loan. Make sure you completely understand the terms of the contract before you borrow to avoid getting into a debt trap.