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How to get bad credit loans in Utah

How Do I Get a Loan in Utah if I Have Bad Credit?

Updated on January 16, 2023


When it comes to borrowing money, a credit score is the most critical factor that shows a lender the level of risk they will take when they lend you money. Therefore, if you have a good credit score, most lenders will be willing to loan you some money. However, the opposite is true for anyone with a bad credit score. If your credit score is low, getting bad credit loans in Utah can be a challenge.

What Does a Bad Credit Loan Mean?

A bad credit loan refers to financial assistance offered to people who need money but don't have an excellent credit history and score. This usually happens after you have overspent your credit cards or missed some payments on previous loans or bills.

So, when you are in financial difficulty and need to make some quick money in Utah despite your bad credit score, you'll have to look for loans for people with bad credit. Apart from your credit score history and scores that will affect the loan conditions, getting bad or no credit loans in Utah is quite similar to getting loans with good credit scores. This is because you still have to find a lender and agree on the repayment plan, interest rates, and so on.

However, getting a lender for bad credit can sometimes be challenging. But if you are ready to search a little more, you will get bad credit loans to help you deal with your financial issues.

What Is Considered a Bad Credit Score?

Before showing you how to get bad credit loans in Utah, you should know whether your credit score is bad or good. Here's a list of credit scores below:

FICO credit scores chart
  • 850 to 800 – Excellent
  • 799 to 740 – Good
  • 739 to 670 – Fair
  • 669 to 580 – Poor
  • 579 and below – Very Poor

Most lenders don't lend money to people with credit scores below 650. However, some consider credit scores that are slightly below 650 to be good. Therefore, you should speak to each lender to know whether your credit score can qualify you for a loan.

What Are the Challenges Associated With Loans for Bad Credit?

Now, if you are contemplating getting installment loans in Utah, you know note that their drawbacks which include:

High-interest rates

Since the lender will risk lending you money, your loan's interest rates will likely be higher than interest rates for people with good credit scores.

Collateral might be required

In some cases, the lender will require collateral, something of value like a car or house. So, if you don't pay within the agreed period, you may end up losing your vehicle or home.

Penalties and fees

Many bad credit loans in Utah come with many fees and penalties such as late fees, loan origination fees, etc. These fees and penalties can even put you in a more difficult financial situation.

Dealing with an unlicensed lender

Sometimes desperation can lead to bad decisions. Always work with a lender that operates with a license in Utah. Explore each website of the online lender to ensure they are licensed. If you can't find any page with a license, then move on to the next option.

What Are the Alternatives for Getting a Bad Credit Loan?

Assuming you have finally decided to get a loan with bad credit, here are a few options to consider.

Getting loans from licensed online lenders

The advent of technology has simplified everything. So, you can now obtain a loan from the comfort of your home through the help of online lenders. By definition, online lenders are institutions that operate online to provide people with loans. Therefore, you can count on this option. Nonetheless, you have to be cautious and research the company.

Using a cosigner

A cosigner is an individual with good credit scores that can cosign a loan with you. Of course, this individual is usually a close friend or relative that trusts you enough to enter into such an agreement. It's essential to understand that a cosigner will take responsibility for the loan if you don't repay during the agreed lending period.

Again, you must be careful when using this option to put the other person at risk. Your failure to repay will put the responsibility on the person who cosigned, which can destroy your relationship.

Getting secured loans

Most financial institutions allow borrowers to get loans with collateral. In other words, you will secure a loan with your vehicles, home equity, investments, etc. In this case, if you fail to repay the loan as agreed, the lender will have to take over the collateral. Otherwise, you can consider payday loans, which means the money will be deducted from your next wages.

The good thing about obtaining secured loans is that they are easier to get. Also, the interest rates are not usually high, as the lenders already have what can be used to offset their potential loss. While secured loans may look attractive, you should be confident that you can afford the loan.

Obtaining a cash advance

This means that you obtain a loan with your credit card or find online cash advances in Utah. Make sure you check the interest rates; not all cash advances are created equal. Some lenders charge application fees or have prepayment penalties.

Borrowing from friends and family

If you have a good reputation among your friends and family, obtaining a loan from them could be an option. They will probably understand your situation; hence, it is easy for them to overlook your bad credit scores. Also, your friends and family may not even require interest on the loan.

However, don't treat the loan as a family affair. Be sure that there is an official legal agreement between the parties involved. The loan amount, repayment plan, lending period, etc., should be written clearly. Besides, understand that failure to repay as agreed could spoil your relationship with the other person. Therefore, make sure you follow the agreed terms.

Peer-to-Peer lending

Peer-to-peer lending (P2P lending) refers to an online platform that gives people loans. This system works by enabling a borrower to obtain a loan directly from a person or group of persons. In this case, there is no need for an established financial institution as willing individuals do everything.

You will generally go to a peer-to-peer lending website and explain the loan option you are looking for. Potential lenders will check the listings before deciding whether they want to lend you money or not.

Although some lenders will consider your credit score, getting loans through peer-to-peer lending is quick and easy. This is because many lenders will consider other factors that don't relate to your credit scores.

Additionally, most peer-to-peer lenders don't have high-interest rates. Therefore, this could be a better option than lending from traditional financial institutions.

Using your long-term relationship with your bank

In general, banks usually do not lend money to people with bad credit scores. However, you can still get loans from a bank if you already have a long-term relationship with them. To do this, you'll need to visit your bank to discuss your financial situation and repayment plans with the loan officer in your bank. Don't hesitate to let them know about your long-term relationship with them, as this can make them have a second thought.

Joining a credit union

When you need no credit loans in Utah, joining a credit union is another option. Community members primarily own credit unions, so there is a level of trust among the members based on their reputation. Consequently, it is usually easy for credit unions to overlook your credit scores and give you the loan you want.

Similarly, the interest rate is usually lower than loans from banks and other institutions. Also, you can rest assured that there will be no additional fees or penalties.

Tips for Getting Bad Credit Loans in Utah

As stated earlier, obtaining bad credit personal loans in Utah can sometimes be challenging. So, when you come across a lender willing to offer you loans in Utah, you may want to jump on the offer. However, you must be careful as lenders are looking for ways to take advantage of you.

Given this, avoid the following lenders:

  1. Those without state license and registration
  2. Those that request upfront fees
  3. Those that ask for a wire transfer of money
  4. Those with bad reviews on independent review websites
  5. Those that ask for personal information before giving you a written loan agreement

CASH 1 Has Loan Options If You Have Bad Credit in Utah

If you live in Utah and you're ready to look for a loan with bad credit, CASH 1 can get you approved online. You could get money deposited into your account within one business day. With our online loans in Utah, you can build your credit with us and lower your interest rate when you make payments on time.

Photograph of author Joseph Priebe

Joseph Priebe

Joseph Priebe takes pride in assisting audiences with his articles to help them make sound financial decisions.

With over ten years of experience writing financial content his goal at CASH 1 has always been creating engaging and easy-to-digest information for anyone searching for immediate or long-term monetary solutions.

When Joseph is not writing about personal finance, you can find him photographing the Southwest United States with his 4x5 Graflex Crown Graphic camera. He is based in Phoenix, Arizona.