Are you a single mother with a bad credit score looking for a loan? Getting a loan with a poor credit might not be hard, considering the number of loan companies out there clamoring for borrowers. But it is of utmost importance that you do not fall for an exorbitant interest rate, or worse yet, scam companies in the Internet. Not all private loan companies are shady. No doubt private lenders charge much more than banks or credit unions, but with a little diligence on your part, you can choose a lender that provides a loan fitting your pocket.
Is a loan from a bank or credit union even possible?
Getting unsecured loans from a bank when the credit rating is not impressive at first look might be hard even for those who have had a stable employment history. Pledging a collateral or getting help from a creditworthy cosigner might raise the chances of getting approved for a personal loan – but there is no guaranteed approval. Lenders are apprehensive of lending money to any borrower whose credit history is not what they expect. A credit report showing defaults and late payments is likely to be turned down right away without other factors taken into account.
Is private lending the answer?
If your attempts at borrowing money from banks near you fail, private lending might be a place you can turn to. But before resorting to borrowing from a private lender, check with the local credit unions. The advantage of borrowing from a credit union rather than a private lender is that the interest rate will be much more affordable.While the interest rate would be low, do not expect guaranteed loan approval from a credit union. Credit unions are indeed far more lenient when it comes to approving a loan, but several factors are considered before a loan application is approved.
Borrowing from private lending institutions has been made easier than ever because of the option of online application. Online applications lead to easier and faster approval without you having to wait for weeks. Single moms are advised to compare quotes from various lenders before deciding on one. Most importantly, be wary of any loan company asking you for an upfront fee. A lot of scam companies tend to lure people in by claiming fast 1-hour approvals for even bad credit borrowers. Many scam companies can be easily identified by their requirement of a small fee in advance before any money is lent to you.
How else can a single mother meet unforeseen expenses?
If your need for a loan is to deal with emergencies, make the most of local resources that offer assistance for such events. Local churches and non profit organizations are excellent sources of assistance for people who face crisis in their life. You can find assistance being offered for such things as paying bills, rent, or for buying food. In addition to getting help with emergency needs, apply for assistance offered by your state government. Visiting the social services near you is all that is needed to know about every program you will qualify for. Most of these programs do not cater to emergency expenses, but rest assured that once you get approved for a few of them, you will be better able to deal with the financial issues in life. These programs help with affordable housing, paying rent, food, health insurance and daycare.