Guidelines to Get a Debt Consolidation Loan with Bad Credit
If you happen to have a lot of different types of debts hanging over your head, you might consider getting a debt consolidation loan to help you out. Consolidating all your debts into a single amount helps in most cases. But the problem arises when you have a bad credit score.
A FICO score below 579 is considered poor and with such a score it might get difficult for you to get a consolidation loan. If you are facing such a situation, you can always connect with us. We specialize in providing consolidation loans and our debt consolidation loan bad credit UK services should be able to help you out.
So, what to do when you have bad credit and you still want a debt consolidation loan? The good news is, even with poor credit, there will be options open to you. And we will be discussing them here. So, read on.
Can You Get a Consolidation Loan with Bad Credit?
The short answer is yes. You can apply and even qualify for a consolidation loan even with a bad credit score. But that will come with some factors that you need to keep in mind. If you have bad credit, even if you manage to get a consolidation loan, the interest rates will be higher.
Also, lenders would want to find out if you are capable of demonstrating adequate credit hygiene. This includes your current income, the way you are paying your current debts, and more such factors.
If you have been demonstrating healthy credit habits lately, like paying your credit card or other debts in time for several months, that would not only help improve your credit score but will also make the lenders confident about working with you.
Generally speaking, a lower credit score will mean a higher risk for the lender and vice versa. So, before applying for a debt consolidation loan, you must check if you have any way to improve your credit score first.
Does Getting a Debt Consolidation Loan Affects Credit Score?
Your credit score goes a long way in deciding whether you will qualify for a consolidation loan or not. So, you wouldn’t want to do anything to hurt it. But generally, if you apply for too many loans at once, it may affect your credit score. But closing many accounts and replacing that with a single loan amount can be viewed as a positive effort in managing your debts more responsibly.
So, check out your options for getting a consolidation loan when you have bad credit. There will be options available and you can easily narrow down your search as many lenders mention their credit score requirements clearly on their websites. After narrowing down your search, do not apply for loans from all of them at a single time. Discuss with the lender and if you see a chance, proceed one by one.
Debt Consolidation Loan with Bad Credit and No Guarantor
If you can find a guarantor things can go smoother in qualifying for a debt consolidation loan. The guarantor assumes responsibility for your loans if you fail to pay back. But finding such a guarantor can be tough as no one wants to take responsibility for some other person’s liabilities willingly.
If you have no guarantor, your credit history will matter in deciding whether a lender will approve you a loan. To make your credit history stronger, you can wait for some time. And in that time, make efforts to clear your current installments regularly in time for a few months at a stretch. It’s also a good idea to lower your monthly expenses by cutting out on non-essentials.
This is how you can get a debt consolidation loan even with bad credit. If you are having any queries, our debt consolidation bad credit UK services are most willing to help. Just remember that it’s possible to get a consolidation loan even if you have a bad credit score. You just need to do the right things to qualify for one.