How to Borrow Money With Bad Credit
Find someone to borrow from., Agree to terms., Get it in writing., Ask about cosigning.
Step-by-Step Guide
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Step 1: Find someone to borrow from.
If you have a friend or family member who is willing to loan you some money, this may be your best option, as someone you know is more likely to loan you money on flexible terms and/or at a better rate. -
Step 2: Agree to terms.
Make an agreement with your friend or family member about how much they are willing to loan you and their expectations about repayment, including any possible interest.
To ensure your relationship isn't harmed by this transaction, make sure to be open and honest with the creditor about your circumstances and when you expect to be able to pay them back., It's a good idea to put your agreement in writing.
This way, there is no conflict later about what the terms of the agreement were.The lender may ask you to sign a promissory note, and may even want to get it notarized to bolster its legal standing.Treat the terms of a loan like this just as seriously as you would a bank loan. , If you need to borrow a larger amount than any of your friends or family have on hand or are willing to loan you, you may want to consider asking them to cosign on a bank loan.
If the individual you have asked to cosign the loan has better credit than you do, you may be able to get a much better rate if they also sign the loan.Keep in mind that if you fall behind on the payments of your loan, your friend or family member's credit score will be negatively impacted, possibly severely so.
Don't take out a loan with someone else's name on it that you can't afford to pay back.
Your specific rate in this case can vary based on your family member of friend's credit score.
Consult an online loan repayment calculator to determine your payments and repayment schedule. -
Step 3: Get it in writing.
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Step 4: Ask about cosigning.
Detailed Guide
If you have a friend or family member who is willing to loan you some money, this may be your best option, as someone you know is more likely to loan you money on flexible terms and/or at a better rate.
Make an agreement with your friend or family member about how much they are willing to loan you and their expectations about repayment, including any possible interest.
To ensure your relationship isn't harmed by this transaction, make sure to be open and honest with the creditor about your circumstances and when you expect to be able to pay them back., It's a good idea to put your agreement in writing.
This way, there is no conflict later about what the terms of the agreement were.The lender may ask you to sign a promissory note, and may even want to get it notarized to bolster its legal standing.Treat the terms of a loan like this just as seriously as you would a bank loan. , If you need to borrow a larger amount than any of your friends or family have on hand or are willing to loan you, you may want to consider asking them to cosign on a bank loan.
If the individual you have asked to cosign the loan has better credit than you do, you may be able to get a much better rate if they also sign the loan.Keep in mind that if you fall behind on the payments of your loan, your friend or family member's credit score will be negatively impacted, possibly severely so.
Don't take out a loan with someone else's name on it that you can't afford to pay back.
Your specific rate in this case can vary based on your family member of friend's credit score.
Consult an online loan repayment calculator to determine your payments and repayment schedule.
About the Author
Sandra Ross
Sandra Ross is an experienced writer with over 11 years of expertise in lifestyle and practical guides. Passionate about sharing practical knowledge, Sandra creates easy-to-follow guides that help readers achieve their goals.
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