The topic may invite mixed reactions. The excitement of getting guaranteed approval with bad credit keeps you on the hook. Alternatively, you might be thinking - Does such a thing as guaranteed loan approval even exist? It is natural to have such queries when you need cash urgently but have low credit. Moreover, aspects like “get loans with guaranteed acceptance” urge one to click “apply.” However, you resist taking any initiative.
You do not want to damage your credit rating. Therefore, you explore the possibilities of getting instant loan approval despite past financial mistakes. The blog discusses the possibilities of a guaranteed approval loan with a bad credit rating. Let’s initiate with the basics.
What does a bad credit score look like?
You may have a less-than-average credit score if your credit profile reveals missed payments. It may have aspects like CCJs, loan defaults, bankruptcy, late payments, etc. Such parameters impact your payment history and credit score drastically.
In such situations, getting a loan or a credit card is challenging. It is because creditors don’t trust the borrower with the repayments. They see such borrowers as a risk to their financial lending structure. Hence, they may disapprove the loan application.
Alternatively, some may impose additional conditions, like- guarantor, collateral, or co-signer, to approve the loan. Such aspects grant security to the loan provider regarding the payments. Thus, he may provide the loan at low interest rates.
Thus, the loan agencies conduct credit assessments to determine the affordability. Getting a “guaranteed loan” is unlikely in that case. If you have been seeking loans for bad credit with guaranteed approval, you must know about it. It will assist you in making a well-suggested loan application and prevent a credit score..
What do you mean by “guaranteed approval” on loans?
Going by the literal meaning, guaranteed approval may mean “getting a credit card or a loan regardless of your financial affordability.” However, that’s now how it works. No responsible loan company provides immediate approval without conducting a basic affordability assessment.
Therefore, “guaranteed approval” in actual cases means you may get the loan if you pass the specific affordability criteria. Precisely, you may qualify if you can afford the loan repayments without impacting other life expenses.
Can you get guaranteed approval on loans with bad credit?
Unfortunately, not every loan provider offers guaranteed approval to people with a bad credit history. It is due to the risk associated with non-repayment or default. However, some may still offer guaranteed loan approval to borrowers with their lower credit scores.
These specialised companies share expertise in dealing with and helping people with bad credit scores. Thus, you have a high chance of qualifying with such companies instead of mainstream loan providers.
The specific bad credit loan providers do not prioritise credit scores alone. Instead, they value the overall financial management of a borrower. They analyse how well the individual manages finances, ignoring past credit mistakes. It helps them analyse your repayment chances and the amount you can repay comfortably.
How to get a loan in the first attempt with a bad credit score?
Yes, you can surely improve your chances of getting instant approval despite a bad credit history. It is ideal for students, the self-employed, the unemployed, or the employed applying for the first time. Here are some aspects to work on before applying for the loan:
Update financial documents
You must check your credit report, bank statements, electoral roll, and tax statements before applying. Update the information like name, email, contact, residential address on the electoral roll and ID proof. Similarly, analyse your credit report for the paid and unpaid debts.
Report the delinquencies (if any). It will help you boost your credit rating a little. Additionally, you must have the latest income proof.
- Identify the eligibility and pre-qualify
The eligibility criteria may differ across the loan providers. Check it and pre-qualify to know how much you can afford. It may not tell you the exact figure. However, you can still get a vague amount that meets your affordability standards. Use this as the base for your loan application. This whole process does not affect your credit score. Instead, it helps you borrow a loan responsibly.
Borrow a comfortable amount
You should not consider too high or too low an amount to borrow. Instead, strike the right balance between the two by understanding your cash needs. Check whether you can bridge some amount using savings. Is it possible to meet your needs for a smaller amount compared to what you need? If confused, you can take the loan provider’s help. He may help you figure out the exact amount to borrow. No, you don’t need to pay for that.
Tip: Borrow an amount less than your total monthly expenses and income. It should be specific to the purpose for which you want to take a loan.
Do not err during the loan application
Providing accurate information is the basis of the loan approval. Every valid loan company verifies the details with the actual documents. Therefore, always provide details as per the documents or proofs. It generates authenticity and helps you get the loan approval instantly. Check each spelling, character, number, etc., before clicking “apply.”
Read the terms before applying
It is the bare minimum that you must not ignore. Check the fine print before consenting to the loan application. Explore the loan fee structure to avoid the surprise later. Moreover, it also lists rules regarding the documents and repayments. Read it to avoid the last-minute loan rejection.
Does getting a guaranteed loan affect your credit score?
No, the initial loan application does not hamper your credit rating. It is because the creditor provides a basic quote based on the application. It is also known as a no credit check process.
Under this, you get a basic quote of the amount you can afford (approximate) as per the information. It is a no-obligation quote that you can proceed with. You can reject according to your convenience. No, the loan provider does not charge you if you don’t proceed with the application.
Bottom line
Yes, you may get a loan approval despite a bad credit score. It just requires you to apply with the specific loan providers that deal with low credit score profiles. It increases the chances of loan approval. Alternatively, pre-qualify and analyse the amount you can comfortably qualify for. Avoid seeking more than that on your loan applications. Similarly, read the loan terms and provide verified details for approval.
