Having bad credit can put a significant damper on getting nearly any form of financing that you need. Organizations like payday lenders offer promises of helping those with bad credit find the perfect solution. But are they really trying to help, or are they more interested in profiting off of your misfortune? Data suggests the latter is more true. In fact, according to the Consumer Financial Protection Bureau, over 80% of payday loans are rolled over or followed by another loan within 14 days (i.e., renewed). Plus, 15% of new loans are followed by a loan sequence at least 10 loans long. Half of all loans are in a sequence at least 10 loans long.
Poor credit can make it seem like you have no other options, but solutions like payday loans really do nothing but prey on your desperation. They may feel like a solution in the short-term, but really do extensive damage in the long-term.
The truth of the matter is, there are plenty of people who do just fine when they understand how to navigate bad credit without turning to companies that offer big solutions and even bigger problems in the long run. Here, we’ll go over some tips on how to get a loan with bad credit and offer some alternatives that may suit you better.
Bad Credit Lenders: Not Everything That Glitters is Gold
There are numerous ways you can get a bad credit loan in Illinois. Potential borrowers are often seeking a way to pay off debts that have gotten out of control, or a quick-fix to pay for expenses that are unaffordable at the moment. While payday loans are the worst-of-the-worst for anyone seeking financial assistance, a HELOC or home loan can be a quick way to reach for the money we need. But there are risks that come with such avenues.
The major issue with choosing a HELOC, especially from a company that “specializes” in bad credit loans, is the amount of interest that you will owe throughout the term of the contract. It’s vital to pay close attention to the amortization of the loan as well as exactly how much interest will be paid throughout the contract. People tend to become more interested in the monthly payment rather than the loan’s terms; an oversight that can eventually wreak havoc on your long-term financial health. That, of course, is a huge mistake. It’s imperative to always fully understand the contract before it is signed, especially when it concerns our home.
Bad Credit Loan Requirements
Getting bad credit loans in Illinois can be an option for people who have a credit score that is 600 or less. Generally, the lender will require valuable assets to use as collateral such as a home, savings, stocks, or even a 401k retirement account before you can even qualify for the loan.
Some companies also typically ask a borrower to list the value of the items they have in the home, such as electronics, furniture, jewelry or computer equipment. Having low credit ratings means that you are a bigger risk to lend money to, so these organizations need to know that when push comes to shove, they will be able to get their money back somehow. They hint at the extreme potential of losing our home or everything that has been listed within the loan application.
Those who can’t or won’t pay off their loan in full are sometimes shocked to find out many years later that the assets listed in the application are being sought in a court case against them.
Common home equity loan complaints include:
- Misleading Offers
- Hidden Fees
- Billing Disputes
- Inapt Customer Service
- Abusive Collection Tactics
- Predatory Lending Practices
- Seeking Help for Poor Credit
Poor credit can be improved with small, consistent changes when handling our credit. It takes time, but meanwhile, there are credible companies that offer alternatives to home equity loans, HELOCs, and payday loans. Also, there are reputable non-profit agencies that specialize in helping people learn how to manage our finances and credit better. Find a full list of federally-approved credit counseling agencies by state here.
Bad Credit Loans Alternative in Illinois — When Banks Say NO, We Say YES
SKYDAN Equity Partners helps homeowners who have poor credit, bad credit, or no credit get the money they need in order to pay down debts or pay for life’s surprise expenses. We consistently strive to help homeowners make the right financial decisions by not only helping them get out of a temporary financial bind, but also setting them up for long-term financial success. Our unique program allows you to access the equity in your home without having to sell it off.
With a home equity loan alternative from SKYDAN Equity Partners, homeowners never have to worry about needing a specific credit score. That’s because we do not use a credit report to qualify an applicant for any of our programs. The only thing you need to qualify is having enough equity in your home. It’s as simple as that. We understand that financial difficulties can occur, and they often affect a person’s credit through no fault of their own, especially during the coronavirus pandemic.
Homeowners can access up to $250,000 in home equity in 30 days or less — with zero interest. The money can be used for tax payments, debt consolidation, home repairs, remodeling, or even bridging the gap in income during a financial crisis. Our unique home buy-back option also allows the flexibility to sell the property above the agreed price and pocket the excess money. It’s, in essence, an investment opportunity without the usual risks.
It’s imperative at SKYDAN Equity Partners that we set an expectation of excellence with our programs so that homeowners feel confident in their decision. We care about the community and want to see people succeed. Having poor or bad credit shouldn’t prevent that from happening.