Home Finance Best Bad Credit Loans of December 2021

Best Bad Credit Loans of December 2021

bad credit loans

Bad Credit Loans – Individuals with bad credit have one option available if they need some cash – bad-credit loans. Apart from that you can also explore cheaper alternatives to a bad-credit loan, such as borrowing from a family member or taking on a side job.

If this describes you, you might be eligible for a personal loan from a lender that caters to people with bad credit. Such lenders typically provide a straightforward application process and quick funding, however the loans can have much higher interest rates.

Although lending institutions that include banks such as ABSA, FNB or Nedbank might not give you credit if you have a bad credit score, there are other lenders that are willing to take that chance and give you finance, but obviously this will come with lower loan amounts and higher interest rates because of your credit risk.

How to Get Bad Credit Loans Approved

Here are some things you may do to improve your application and increase your chances of getting the loan you desire.

Look through your credit report. Is your credit score being harmed by a credit reporting error? You can check your credit report for any delinquencies or accounts that aren’t yours that have been mistakenly reported. You can boost your chances of qualifying by addressing these concerns before you apply.

Take a co-borrower or co-signer. Because the lender will examine both applicants’ credit and income when making a choice, adding someone with superior credit may improve your chances of qualifying. Bare in mind that anybody you select is responsible for the debt if you don’t pay it back.

Throw in some collateral. A secured loan may help you get accepted faster or at a reduced rate. Borrowers can receive a loan with collateral, generally a vehicle, through online lenders, however, if you are unable to repay the loan, the lender may seize the collateral.

How to select the best Bad Credit Loans

Every lender is different, but if you qualify for a rate similar with many lenders, evaluate all to see which loan will benefit you the most.

When considering bad-credit loans, keep the following five criteria in mind:

Low Interest Rates

Look for a lender that has a rate cap of 36 percent, which is the maximum rate that consumer advocates consider affordable. There are certain online lenders that provide no-credit-check loans with interest rates over 36%, but we advocate using them only as a last resort after you’ve exhausted all other options.

Your Credit Record is Reported

Finding a lender that reports your payments to credit bureaus is a good start. A lender should ideally record your payment history, ensuring that timely payments help you establish credit and qualify for lower interest rates over time.

Quick finances

If you really need cash immediately, an online loan can be the ideal alternative for you. Online lenders can often fund a loan the next day, if not the same day, after you’ve been authorized. If you’re already a customer, several banks and credit unions may be able to secure a loan quickly.

Application Process is Easy

Online applications are simple to fill out and only take a few minutes to finish. Pre-qualifying with an online lender is an easy method to get an idea of your rates and terms without damaging your credit score.


Many lenders offer tools that aid in credit building, such as free access to your credit score. The lender’s website may also provide free financial education.