How to Improve Your Credit Status

By: Christian Phelps

Personal loan for people with bad credit is a type of loan designed especially for people with bad credit record. Generally, lenders do not provide loans to borrowers who have bad credit history. Bad credit history means that the borrower defaulted in making payments and terms and conditions have not been honoured by the borrower.

Now, there are lenders who offer bad credit personal loan even if you are owner of a property or even if you have bad credit. A bad credit personal loan can also help the borrower to re-establish their credit rating.

Through a secured personal loan for people with bad credit you can borrow up to 125% of the value of the asset you provide as collateral or up to ?75,000. The actual amount varies from lender to lender. The loan amount also depends upon the income level, and whether source of income is permanent or temporary.

Interest charged on loan again varies from lender to lender. It also depends on the profile of borrower in terms of his credit score, source of income, age etc. Usually duration for repayment is between 5 years and 25 years.

In this case, a borrower has two options:

First, to go for short duration loan in which case the installment amount is usually higher but the hidden advantage is that the borrower can payback completely within a short span of time and interest charged is comparatively lower.

Second, to go for longer payment duration, in which the instalment amount becomes less compared to an instalment for short duration loan but such installment needs to be paid every month for a longer duration.

You can renovate your house or if you are falling short to cash to buy a car, you can use personal loan for people with bad credit, for anything and everything. At time borrowers also use bad credit personal loan to pay credit card bill and reduce other debts to reduce their monthly expenditure.

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