While your credit may have taken a beating in recent years, that does not mean you can’t secure a loan. What it does mean is that you will need to work with lenders who offer bad credit secured loans. Loans of this type generally have specific criteria that applicants must meet. By choosing the right lender, you can use this loan to purchase a car or something else you need, and also begin the process of rebuilding your damaged credit.
In order to qualify for a bad credit secured loan, you will have to provide the lender with proof of your monthly income. Your most recent paycheck stub will often suffice. The goal is to determine if you current make the minimum amount needed to qualify for the loan. As long as you make at least that minimum, the first hurdle in your quest for a loan is cleared.
Loans of this type also require some sort of security or collateral. If you are using the bad credit secured loan to buy a car, then the vehicle will usually serve as the collateral. In other cases, you may need to pledge some other asset that the lender is willing to accept. With most situations, you continue to have use of the pledged asset, but you cannot sell it until the loan is repaid in full.
As with any loan situation, make sure that the payment schedule is one that you can honor. Doing so will ensure that your reputation with the lender will remain positive. In addition, the comments that the lender submits to the major credit reporting agencies will also be positive, and you will see your credit score begin to rise in a matter of months.