Debt Consolidation Loans For People with Bad Credit

This may not be as hard as it sounds. Actually if a person with bad credit is looking for a debt consolidation loan, it means that they are concerned about their credit and are making an effort to fix it. You may find that banks like these people.

Since most people with bad credit think that it is hard to get a debt connsolidation loan, some companies will take advantage of them! It is sad, but a fact of life.  So what can you do?

Research the loan company.

Sounds like a nobrainer, but some people would think that they are lucky to get a loan and will take the first offer that approves them. Do not do this! Do some homework and check out the company from every angle. Check for complaints and rates. See how long they have been in business.

Look at all of the details.

If you have bad credit, you will probably pay a higher than advertised rate of interest. Make sure that you know all of the penalties as well.

The length of the loan.

This will have an effect on the rate and the amount of interest that you pay. Make sure that you can live with the terms. You may want to go for a shorter term to save some money. Just make sure that you have a rainy day plan, because there will be rainy days!

Size of the loan.

Sometimes rates are lower for larger loans. If you are shwred, and it is allowed, you may borrow a larger amount and use the extra to pay off part of the loan. This may put you ahead enough to give you a little cushion.

Redemption penalties.

Make sure that you know if there are any penalties for early payoffs. This could hurt you.

Just one last thought. If you have bad credit and you are considering a debt consolidation loan, make sure that you have looked at your other options.

With proper planning you may be able to get out from under that debt on your own. For instance you can call all of your creditors and see if they can help you work out a repayment plan that better fits your budget. You may be surprised at the people that are willing to help you. Believe it or not most creditors want you to pay your bills and have good credit. Sometimes it just takes a phone call to get the ball rolling!