The Best Ways to Borrow Money Fast With Any Credit Score
Having a low credit score can make you feel like there’s no way to live a comfortable or semi-luxurious lifestyle with your current level of income. After all, while people with good credit have no problem being approved for credit cards, loans, homes, and vehicles, you’re going through life taking whatever you can get your hands on. It’s a tough battle to fight, especially when you find yourself encountering a sudden need to borrow money via online loans and you simply don’t have time to improve your credit score before doing so. With that said, here are five of the best ways to borrow money fast with poor credit:
How much would you like to borrow?
Representative Example: Rates from 49.9% APR to max 1333% APR. Minimum Loan Length is 1 month. Maximum Loan Length is 36 months. Representative Example: £250 borrowed for 30 days. Total amount repayable is £310.00. Interest charged is £60.00, annual interest rate of 292% (fixed). Representative 669.35% APR (variable).
Bad Credit Payday Loans
You can usually be approved for a payday loan and receive the money on the same day. Most payday lenders have online application portals that let you submit your application from home while also having physical locations where you could apply in-person to receive the money as cash upon approval. Many payday lenders can load one of your debit or credit cards in a matter of hours or minutes, so it is often a same-day process.
If you opt to have the funds deposited in your bank account via a BACS transfer, then the process of actually receiving the money could take 1-3 business days. However, your actual approval can happen within minutes of submitting your application. When it comes to borrowing money as quickly as possible despite having poor credit, no other options can compare to payday loans in the ease of approval and speed of funding. Most payday lenders offer loan amounts ranging from £100 to £2,500 with repayment periods ranging from three months to a year and a half.
While your credit score will not be a primary factor in determining your approval, there are some requirements you should know about. Here’s what you’ll need in order to be approved for a payday loan:
- Proof of Age and Identity – Be prepared to show some form of identification – either a government-approved ID card, passport, or photo card driving licence will work fine. This is used to verify your identity and confirm that you’re older than the minimum age requirement of 18.
- Proof of Reliable Income – You’ll also need to show that you have a reliable source of income that will be sufficient to make scheduled repayments. The loan amount that you’re approved for will be based on the average income you earn within each pay period. Larger loan amounts over £1,500 are typically reserved for people with higher-paying jobs, but most employed individuals can obtain approval for amounts in the £100 to £1,000 range.
- A Bank Account – Most payday lenders will ask you to provide the account and sort code for your bank account, as these credentials will be used to arrange an automated payment schedule, similar to how an internet service provider would auto-bill your account every month. You’ll be signing an agreement to let the lender debit your account on a pre-agreed upon due date, which will typically be on or shortly after your upcoming payday.
If you can provide the above details, you should be able to get approved for an online loan with bad credit with very little effort.
Ask Your Bank or Credit Union
Another lightning-fast way to borrow money without having good credit is to simply consult with a representative at your bank or credit union. This won’t work well if you don’t have an account with them, so this is really only a method that should be considered if you have an active account with them that has been kept in good standing for a long time.
Many banks and credit unions will use your past bank statements as an indicator of how much they can let you borrow. In this way, they’re taking the position of a payday lender by basing their decision on your income rather than your credit score.
Speaking with conventional enders about your options won’t hurt, but you should always find out if they perform a hard credit check before submitting a loan application. Many banks and credit unions will run a hard check on your credit, which could hurt your credit score even more if you’re denied. It’s best to avoid any loan applications that require hard checks if you have a low score, as you’ll most likely just wind up causing more damage.
Get a Friend or Family Member to Co-Sign
If you can get a friend or family member who has good credit to act as a co-applicant, that could significantly increase your chances of being approved for a loan. This is an ideal approach to consider if you’re trying to borrow money fast and you don’t have the time to build up your own credit in the meantime.
Lenders will process your application based on an average between your score and your co-applicants. You can also use this technique to obtain a lower interest rate or higher loan amount after being pre-approved. For example, a lender might pre-approve you for £2,500 but then offer higher amounts if you can get someone with good credit to co-sign for you.
Unfortunately, actually convincing someone to do this for you can be easier said than done, which is why family members or very close friends are the only people you should be asking. Even then, nobody wants to ruin their own credit or put it at risk to help out a family member who they know doesn’t have a history of repaying debts.
Even though there’s a slim chance it will work, it’s worth a try when you consider it could facilitate your approval for much higher loan amounts and more lenient repayment terms.
Come Up with an Excellent Business Idea or Other Funding-worthy Cause
Great business ideas aren’t dependent upon credit scores, but it certainly does help to have proof of concept in the form of revenue stats or other metrics that will appeal to investors. So, where do you go to borrow money for your business idea or personal cause?
Well, there are several approaches you can take, but you’ll find that crowdfunding and social networking are the best options for finding prospective investors or donors. However, you could also pitch your idea to investors on peer-to-peer lending networks if you have a credit score above 600, which is still considered sub-prime but it’s decent enough to make investors look past your bad credit and towards the validity of your proposed business model.
You might be thinking “is this is a legitimate way to borrow money fast?” The answer to that question depends on just how fast you need the money and how much you’re trying to raise. You’re not going to raise £100,000 overnight, but you could possibly raise a few thousand pounds in a week or two with some hard work, a great idea, and a bit of luck.
Some aspiring entrepreneurs have been able to meet their crowdfunding goals within a matter of weeks, which is relatively quick when you consider some of the large amounts they’re able to raise. While there are degrees of skill, work, and luck involved that make this a bit more involved than traditional borrowing or fundraising methods, it’s a worthwhile effort for people with poor credit because your credit score is never factored in on crowdfunding sites.
Use Some of Your Belongings or Assets as Collateral
As a last resort, you could try using some of your belongings as collateral to obtain a loan from a pawnbroker. This is obviously an undesirable approach because you run the risk of losing a valuable item, which may even have some sentimental value tied to it.
Still, we would be remiss not to mention pawnbrokers because they are always an option as long as you have something that can be resold for more than what you’re trying to borrow.
However, be aware that the pawnbroker is only going to give you about 30-50 percent of the item’s value as a loan, so it’s in your best interest to repay them and reclaim your property rather than letting it go for that kind of price.
If you doubt your ability to repay the loan, you’d be better of just selling the item locally on a classified ads site or through an online auction site like eBay. It goes without saying that sacrificing your belongings for a loan is always the final course of action.
Poor Credit Doesn’t Have to Keep You From Borrowing Small Amounts
Ultimately, almost anyone with a job can borrow amounts ranging from £100 to £2,500 or more from a payday lender on a same-day basis. That’s definitely the easiest and most reliable way to borrow money fast because these lenders will approve you regardless of your credit score.
As long as you can prove that you have a consistent source of income that’s sufficient to repay the loan, your credit history and score will really only stop you from borrowing large amounts. That’s good news because you shouldn’t be overextending your debt liability any further if you already have poor credit.