When your credit is bad, it is almost impossible to obtain loans from traditional financial channels. If you want to apply for loans similar to real estate loans, it is more difficult to achieve. However, if you can understand why it is so difficult to borrow with bad credit, you may find a solution.

Your credit history is against you

Because the first thing that those lending institutions or lenders do when making loans is to query your credit records through their methods, this behavior means that if there is something on your credit report about your overdue payment, or you owe too much debt, whether you have ever been bankrupt or not, it will be revealed. If your credit is bad, These lenders will keep a high degree of vigilance against you, but this does not mean that you will lose the opportunity to lend, just that you will face more problems to solve.

Bad credit means great risk

Your credit score represents your ability to repay debts and reputation. If you have applied for a loan but have no actual ability to repay debts, it means that the loss will be borne by the borrower. For a large loan such as a real estate loan, it means that the lender will have to bear more risks. However, even though your credit score may be low, it does not mean that you will not have the opportunity, You just need to find a lender who specializes in providing loans to people with bad reputation.

You will spend more

According to the credit related standards we mentioned earlier, providing loans to people with bad reputation will face great risks. Therefore, in order to offset this high risk to a certain extent, the lender has raised the interest rate of the loan to the maximum extent permitted by law, which means that you will pay a very high interest rate, so your total cost will be a large sum of money.

Can rebuild your credit

When your credit is bad enough that no other institution is willing to lend to you, it is also a good option to choose non-performing loans, because if you return the money you should pay each month on time according to the terms of the contract you signed during the period when you hold the money, then as time goes on, your every act of compliance will offset some of your previous bad credit records, which is important for your credit reconstruction, Maybe it's a good idea.

working principle

The general step is that you provide an application to your favorite loan institution. If he provides credit loans for non-performing persons, he will contact you to discuss the follow-up matters. He will answer the options and terms you need to know one by one, and you need to provide some materials or fill in some forms. Then you will conduct housing valuation, and then you can put forward the quotation you want, They will decide whether to accept your offer according to the actual situation and laws and regulations. Finally, they will give you the interest rate you need to repay and some other handling fees.

（Writer：Dirick）