Having a good credit score makes it easier to deal with hard financial times. You can not only get loan more easily, but also get one at a bearable interest rate. However, all it takes is a little negligence and few delays in payments to turn an excellent score into one that's merely fair or even downright poor. If your credit report tells you that you have a bad credit score, you’re not alone. There are more than 40% of people in America with a fair or bad credit per data collected by WalletHub. So, does that mean you and thousands of other people with poor credit will all not be able to borrow money when it is needed? Of course not.
Getting the cash you need with bad credit is not as difficult as you might have thought. Although a vast majority of loans do consider your credit score, there are plenty of ways to secure funds using the other aspects of your financial condition or the assets you hold. Before we tell you what they are, let’s clear the air about bad credit.
What Makes Your Credit Score Bad?
On the scale of 300 to 850 under the FICO scoring model, if your credit score is below 620, then that means it’s less than good. In order to know the reason you have a low score, you should know how it is calculated. The exact formula for calculating FICO score is still kept under wraps. But the weight given to five criteria found on your credit report that combine to make your score are: 35% to your payment history, 30% to the amount you owe, 15% to length of your credit history, 10% to any new credit account opened or even applied for and 10% to the types of credit you’ve used.
Since the biggest contributor to your credit score is your payment history, a single missed payment can bring down your credit score a significant amount. The second largest factor is the amount you owe. It mainly looks at how much credit you use out of the total available credit you have. The main reason why this factor is given weight is that borrowers tend to miss payments when they are close to maxing out their credit. Also it is against the law for your personal or demographic information like age, marital status, income, and employment to have any effect on your credit score.
How Can I Improve My Credit Score?
Remember that, mistakes can happen by both man and machine. By this, we mean that your credit report may have some errors that drag your score down. So before anything else, make a point to check your credit report for any discrepancies and take corrective action.
Once you know that the report is correct and you do have a bad credit score, it's time to start working on building your credit. There are numerous ways to improve your credit score and get approved for loans. This may take a while but the results will be worth the wait. Since the payment history holds a greater share in determining a credit score, we would suggest you pay off your outstanding bills, starting from the most recent ones. This will help your credit rating improve substantially. To cut long story short, you need to know what hurts your credit score to prevent it from getting any worse.
What If I Need Money before My Credit Score Improves?
Emergencies can occur even when you are trying to improve your credit score. To escape the high-interest rates due to low credit, you can arrange funds on your own by selling your assets or asking friends and relatives. For an even better option, you can get a loan that is accessible to people with bad credit such as a Car Title Loan.
When you already know that you have many bills to pay and your credit is low, you can simply get a bigger loan against your car title and clear all your dues. Title Loans or title pawns, give you the option to borrow cash in emergency situations, without having to wait for your credit to improve. A bad credit title loan at CASH 1 helps you get a loan with bad credit for as little as $100 to as much as $50,000 depending on the value of your vehicle, keeping its monthly payments as low as you can afford. This is the best way to use the value of the asset you hold.
How to Get a Title Loan with Bad Credit
Why would a lender approve your loan if you have a bad credit? Whether you have bad credit or no credit at all, title loans offer you a loan based on your vehicle's value and your ability to repay. Your title and your proof of income work as your credit in the case of a title loans online. And because your car title is used as collateral, Title loans are considered a type of secured loan. For this reason, there is no need for any credit checks or high credit scores.
Getting a title loan with bad credit can also be quick if you get it from us. All you need to do is apply online, bring your vehicle to one of our stores for a quick inspection, sign your documents, and drive away with your cash. The entire process can take as little as 15 minutes!
Does a Title Loan Affect My Credit Score?
Whenever you pay off a loan, you see your credit score go up. So if you are using title loan to pay off your debt, you will see a boost in your credit score. If you don’t wish to see your score to fall again, make sure you do not default on your loan on car title. At CASH 1, we can ensure that you are able to make payments on you title loan on time with low, fixed-rate payments that are due on your pay dates. You can choose to pay off the title loan over a longer period of time to avoid the stress usually associated with other short term loans, and if you decide to pay off the loan early there is no prepayment penalty!