Wednesday, May 31, 2017

Borrowing Money When You Have a Bad Credit Score

depends on your score
If you have a bad credit rating, you will know how difficult it is to borrow money. In fact, it can feel somewhat impossible. However, when an unexpected car bill arises or you have fallen ill and been unable to work, you may have no other option. So, can you borrow money with a poor credit rating? Is it ever a good idea? Read on to discover everything you need to know.

Can you borrow money if you have a bad credit rating?

While it is certainly more difficult for you to borrow money, it is definitely possible. The traditional channels, such as lending from the bank, will no longer be an option. However, there are bad credit solutions available today. Credit card companies such as Aqua have come onto the market to offer financial products for individuals that do not have any credit history or have a bad credit history. The catch is that the interest rates are very high, so you should only go down this road if you know you have the money available to pay off the balance every month.

Of course, the other option is to ask your family or friends with they will be willing to lend you money. This is the easiest route for most people. It means that you can pay back the money comfortably and you don’t have to worry about interest rates. However, a lot of people don’t want to discuss their financial situation with people close to them, so it really is up to you.

One thing you definitely should start doing is taking the necessary steps to improve your credit score. Make sure that all of the information, including your address, is up to date. Cancel any credit accounts that you don’t use and start paying off your debts. You should also avoid making numerous finance applications. This will only look bad. A lot of people attempt to secure credit by applying here, there, and everywhere, even though they know they have little chance. This is something lenders don’t like to see.

Should you borrow money if you have a poor credit score?

If you borrow responsibly, you can actually improve your credit score by borrowing money. By going down one of the channels mentioned above, and making regular payments, you show that you are less of a risk to lenders, and this can result in your score improving. However, it is imperative that you make the necessary repayments each month. You can make the situation much worse if you fall into a larger cycle of debt.
This can easily happen if you opt for a credit card, which is why mobile phones for bad credit are a great idea. Most people pay for their mobile phone via monthly contract payments in any case, and this enables you to do exactly that. So, you will gain access to the phone you need, and you will boost your rating in the process. Unlike a credit card, you won’t be able to make additional purchases or be tempted to spend more money than is needed, which is why this is a good starting point for anyone looking to get back on the credit ladder again after being in debt.

There are options available when it comes to borrowing money if you have a poor credit rating, but you really need to think carefully before going ahead and taking advantage of them. Make sure it is for the purpose of bettering your situation, not making it worse.

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