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Credit Score Enhancing By Means Of Bad Credit Loans

So you have been visited by the Bad Credit Fairy? She has been working endlessly for the past few years and more and more Americans have found themselves “blessed” by her magic. Because it does seem like magic, does it not? Leaving all jokes aside, falling into debt, paying bills off late and defaulting payments is gradual, and it may happen in such a way that when you finally come to realize the extent of the damage on your credit, it might be too late to revert it.

It develops into a vicious circle. You need money to enhance your score and decide that the best way to get it is through a personal loan. You apply for one, and get denied because of your bad credit, which can only be fixed by means of obtaining money that you cannot get. It is indeed a horrible circle. In addition, the more the applications leading to denials, the more the credit report inquiries leading to lower credit score. This article focuses on the use of bad credit loans to improve your credit score.

Get A Loan And Better Your Score!

It might be difficult to realize the process by which taking out a loan can improve your credit rank, as many see it from the wrong perspective: getting further in debt to mend your financial situation? How is that even possible? It is actually very easy to conceive this possibility if you consider the dynamic relationship between your financial actions and your credit history and credit rating.

When you take out a credit card, you boost your FICO score. Pay credit card bills on time, your score will remain high. A late payment will be a stain on your report, and a lower score at that. A default will mean worse news still, I do not need to clarify, do I? What this information tells the lender is that you had no means of repaying your debt due to a number of reasons.

Now, picture yourself taking out a bad credit loan, which will be most likely be used to pay off your older debts. Imagine you received a pay raise, our you got a second job, etc, your income will be higher and thus, your repayment capability will increase. You begin repaying the bad credit loan, and you even repay it timely. This will definitely show on your credit report. And your score will soar.

A Piece Of Advice

It is wise to plan a monthly budget before applying for a loan. Getting a clear idea of what your regular expenditures are will aid you in choosing the loan term which best suits your needs. You do not want to make a mistake when choosing the loan terms, believe me. It will not only get you deeper in debt, but you will also find it impossible to repay. Do your maths wrong, and your financial situation will receive a possibly irreparable blow.

As you might have realized, this matter is not to be taken lightly and must be thought over deeply before any decisions are taken. Your future and that of your family depends on it.

Tips For Choosing the Right Bad Credit Loan Lender

When looking for a bad credit loan lender, there are some tips you can follow. You should research as many lenders as possible so you can find a lender that is going to offer you the best and most reasonable loan for your needs. Researching a variety of lenders will often widen your range of choices for the type of loan you are seeking. Many lenders are available online and this is a great place to start. The online lenders will usually offer you different options when it comes to the terms that you will be under for the loan. When you are online looking you may be able to negotiate your terms because you can see what many different lenders are offering all at once and view their information side by side. It is important to keep in mind that online lending has become a very competitive business, so you may be able to get more out of each lender by letting them know what you have been offered elsewhere.

How Long Is The Loan Process

The time frame for your loan to close and for you to actually be able to spend the money that you get from the loan is normally not too long. Each bad credit loan lender will set their own terms, but in most cases you should be able to get approved and credited with loan funds within 24 hours. Most lenders are going to ask you for basic information, such as your name, date of birth, social security number, and proof of income. As soon as the lender has this information they should be able to process your loan request. When you find a lender online the process is a lot quicker than if you would apply with a local lender. A local lender will take more time to process your request because they have to file your information for you, unlike online where you are able to just enter your information and have everything processed instantly.

Internet Precautions

When you are using the Internet to find a bad credit loan lender, you need to keep in mind that you are asked to provide the lender with some personal information. So using caution when you are online is the best way to protect yourself. Always check the sites security before you enter any of your personal information. Most sites will offer you a secure zone to enter in your information. This “zone” typical shows you a small lock symbol on the bottom right hand corner of the page and several other credentials that will be apparent. Legitimate lender sites are very easy to navigate through and are usually easy to spot.

Other Information To Keep In Mind When Searching For A Lender

Since online lending has become very popular within the last few years, your choices are higher when it comes to what you are offered in a lender. A bad credit loan lender is there to provide you with services that are offered on a wide scale. You may be left paying a high monthly rate because in most cases bad credit loans are offered with very high interest rates. This is due to the fact that most people who are looking to get a bad credit loan are wanting to get the money as quickly as possible which makes it a short term loan that has to be paid back in a very short time frame. So when you are applying for a loan this is something you should keep in mind. Talking to each lender about what your specific needs are is also a good idea.

Six Tips to Help You Recognize a Bad Credit Loan Scam

The suffering and desperation caused by the ongoing credit crisis and job losses, have spawned a whole new growth industry.

Bad Credit Loan Scams

It’s a particularly horrible phenomenon, because the people that operate these scams are preying on those that most need help, and they don’t care if they put the last nail, in a family’s financial coffin.

People that are drowning under suffocating debt, and have poor credit are being bombarded with ads like these, and many similar ones.

Looking For A Loan Or Credit Card But Don’t Think You’ll Qualify?

Turned Down By A Bank Because Of Your Poor Credit History?

Get An Instant Loan. Guaranteed. No Credit Check And Low Interest!

A person that’s desperate for a loan is easily tempted by advertisements and websites like these, because they offer a simple and quick respite from misery.

It’s said however, that forewarned is forearmed;

So let’s Look At The Tip-Offs To Rip-Offs.

Just one of the following should cause you to raise your antennae, and more than one of them should send you looking for another lender.

1) If you’re offered a loan on the the phone.

Companies that do business by phone in the U.S. are forbidden by law to promise you a loan, and to ask you to pay for it before they deliver.

2) The Federal Trade Commission (FTC), which is a federal agency that investigates and eliminates unfair and deceptive trade practices says;

“If you’re asked to pay a fee for the promise of a loan or credit card, then you can almost count on the fact that you’re dealing with a scam artist”.

3) A lender who isn’t interested in your credit history.

A lender who says that he doesn’t care about your credit record should certainly give you cause for concern. Why doesn’t he care?

Any advertisement that says things such as, “Bad credit? No problem” or “We don’t care about your past. You deserve a loan” or “Get money fast” or even “No hassle – Guaranteed”, frequently suggests a scam.

4) A lender who uses a copy-cat names, and similar websites.

Crooks will often give their companies names that sound similar to well-known and well respected organizations, and they also create websites that look like the originals.

Call directory assistance, or locate the lender’s number in the phone book, and then call the number to verify that they are really who they claim to be.

Be sure to get a physical address. A lender that only provides a P.O. Box is one that you should immediately check out with the relevant authorities.

5) A lender who is not registered in your state.

Lenders and loan brokers are required by law to register in the states where they do business. In order to verify their registration, call your state Attorney General’s office, or your state’s Department of Banking or Financial Regulation.

6) A lender who asks you to wire money or to pay an individual.

Never make a payment directly to an individual for a credit card or loan, because no legitimate lender would ever request such a thing.

Hopefully the above information will help prevent you from getting ripped off, but please help others too.

If you encounter a company that’s doing any of the above, then please tip off the relevant authorities.

Where To Complain

The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.

Finally – A Little Bit Of Advice That’s Not A Tip

If you have debt problems, then the very first thing that you should do is to contact your creditors, and attempt to resolve the problems, and the sooner the better.

If you’re unable to resolve the difficulties yourself, or you need some help doing it, then contact a credit counseling service.

There are nonprofit organizations in every state that counsel and educate people and families about debt problems, budgeting, and using credit wisely.

The cost of their services is either free or minimal, and we’re talking about $25.00 – and credit unions, universities, military bases, and housing authorities frequently offer low cost advice as well.

To learn more about dealing with debt, including how to select a credit counseling service, visit http://www.ftc.gov/credit.