Bad Credit Loans
Bad credit loans are granted to people with bad credit history. Sometimes in many people’s lives, they face financial difficulties and are not able to keep up with regular payments of their loans and credit cards. Late payments and outright default on credit obligations inevitably result in a poor credit history, also called bad credit history.
Every person who has ever had a credit card or borrowed from a bank or from an established alternative lender or financial institution has a credit record with his or her lender.
When a lender creates a credit record, they send details of the transaction to a central credit reference agency, also called a credit bureau or a credit-reporting agency. The details they send includes the personal details of the borrower, the nature of the transaction and the amount borrowed
or the credit granted. The credit reference agency then logs this information on their system.
This marks the beginning of a credit history of the borrower with the credit reference agency. From then on, at regular intervals, often monthly, the lender sends updates to the credit reference agency to update them on the payment history of the borrower. The credit agency then updates their files accordingly. Anyone with permission can request a credit history from the credit-reporting agency.
Credit Bureaus in Canada
In Canada, TransUnion and Equifax are the main credit-reporting agencies for consumer transactions and Dun & Bradstreet is the main credit-reporting agency for business credit transactions. A credit history can be excellent, good or bad. An excellent credit history is a credit history that shows no late payments and no defaults on any loan or credit from any lender, typically, over the last 6 years.
A good credit history is a credit history that shows a few missed or late payments but usually has no defaults over the last 6 years. Lastly, a bad credit history is a credit history that shows multiple late payments, missed payments and defaults on loans and credit cards or any form of credit granted to the borrower.
A bad credit history makes it extremely difficult to get a loan from banks. As the saying goes, a leopard doesn't change its spots. In other words, people do not change. As far as the bank is concerned, once you have defaulted on credit payments or have been habitually late on making monthly installments on your loans and credit cards, you will behave the same way with new loans and credit granted to you. Therefore, to minimize their exposure to risk, banks usually, do not lend to anyone with a bad credit history.
However, it is not true in every case that once a person has acquired a bad credit history they will always default or will never be prompt with their payments on new loans and credit cards.
What should I do?
Unfortunately, the banks will still not touch even these people and will say no to their loan applications. The only option for such people, if they need a loan, is to go for a so-called “bad credit loans”. These are special loans conditions granted to people with bad credit history.
There are many bad credit loan companies in Canada that are specifically set up to provide loans to people with bad credit who can afford to make the regular loan repayments but cannot get a loan from a bank.
Bad credit loan companies are more lenient when it comes to lending. They have lower loan qualifying criteria. However, they only focus on people with bad credit history who can now make the monthly installments of loans granted to them. In other words, they are more interested in the ability of the potential borrower to pay back the loan than in their credit history.
Bad credit loan companies
Although bad credit loan companies grant loans to people with bad credit history, they only lend to those who can afford to make the loan repayments. The minimum requirement for a bad credit loan from any of these companies is a proof of income and a verifiable government issued ID.
Very often, a poor credit history is regarded in the same way as bad credit history. The slight difference between the two is that bad credit history is a credit history that is bad when you look at it from all angles – many defaults and missed payments.
A poor credit history may be regarded as a credit history that is not too bad, but bad enough to preclude a potential borrower from getting a loan from a bank. Humorously put, it all depends on where a person’s bad credit history is on the spectrum of credit history rating scale.
Sometimes people with no credit history at all are regarded as having a poor credit history. These are people who for whatever reason, have never been given credit of any sort. This may be the case for young adults who have just become of age and new immigrants to Canada who have not established a credit history yet.
If you have a bad credit history or a poor credit history and you need a loan but have been turned down by a bank, do not lose heart. You can get a bad credit loan from one of the many bad credit loan companies in Canada.
Most of these companies operate online. Loan Away is one of the companies that offer bad credit loans. They have a friendly and understanding staff who will help you with your loan inquiries. All it takes to apply for their loan is to go to their website and click apply now, complete the short loan application form and click submit. You can apply today and get your money within 24 hours.
LOAN APPLICATION REQUIREMENTS
Must be 18 years or older and a permanent Canadian resident
No Active bankruptcy or consumer proposal
Employed for at least 3 months and can show proof of income
WHY IS IT CONVENIENT?
Easy 8 Minutes Online Application
Apply Now and Get Your Money in 24 Hours
4 EASY STEPS TO YOUR CASH
1. Fill the application form online
2. Submit the application by a simple click of a button
3. Get instant approval
4. Get your cash the next day