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How To Get Loans With Poor Credit

May 13, 2008
A bad credit loan is generally a loan that a person with poor credit can get. A person with poor credit could possibly get a normal loan but due to their bad credit the interest rate would be very high. Most bad credit loans are payday loans which can be dangerous.

A payday loan is a loan that is intended to cover a borrower's expenses until their next payday. Payday loans may also be called a payday advance or a paycheck advance. Normally payday loans are between $100 and $500 and are due in two weeks. Payday loans also have a higher interest rate of up to 400% APR. There are two ways to get payday loans, through retail lending and internet lending.

Retail Lending

A borrower goes to a payday lending store to secure a small loan through retail lending. The borrower must pay back the loan on their next pay day. Finance charges ranging from $15 to $30 per $100 borrowed normally come with payday loans. Due to this the rates can range from 390% APR to 780% APR. In retail lending the borrower writes a check in the full amount of the loan plus fees to the lender. The borrower will generally pay the loan back in person when it is due. If the borrower chooses not to pay back the loan in person then the lender will simply process the check through the borrower's checking account.

If the borrower cannot cover the check due to a lack of funds then the borrower will have a bounced check fee from their bank. There can also be additional fees and an increased interest rate due to their failure to pay. If the borrower cannot pay then members of the national trade association will offer an extended payment plan for no additional cost.

Internet Lending

Through internet lending a consumer will fill out an online application form or they will fax a completed application that requests personal information, social security number, bank account numbers, and employer information. The borrower will then fax a copy of a check, signed paperwork, and a recent bank statement. The online lender directly deposits the loan in the consumer's checking account and the charges are electronically withdrawn on the borrower's next payday. You can normally find payday loans through e-mails, paid ads, referrals, and just by searching online.

In conclusion a credit loan that someone with poor credit can get his considered a bad credit loan. People with bad credit can still get normal loans but the interest rate will generally be much higher than for someone with good credit. Payday loans are the most common loans that are considered bad. Payday loans come with high interest rates and high APR. You can get a payday loan through a retailer or through the internet. If you fail to pay back the loan on your next payday then you will have some extra fees to cover. Also if you fail to pay then you will be offered an extended payment plan for no additional cost.
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Find out more about bad credit auto loans and payday loans.
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