Loans for a Poor or Bad Credit History
When it comes to trying to get approved for a new loan or credit card, if you have poor or bad credit, the chances of becoming approved are low. Lenders will view you as a high risk so will either deny your loan request or offer you unfavourable terms. Options really become scarce when dealing with impaired credit.
With limited options, it is sometimes necessary to take on the unfavourable terms as you can start to re-establish your credit. There are many steps involved in this so talking to a financial counsellor is highly recommended. Other options really depend on a few other variables, such as your income level and your current debt to income ratio. Not to mention your employment status and history.
As everyone’s situation is unique, below are a range of options for all backgrounds with the common issue of poor or bad credit.
Some loan options include:
Progress loans – This is an initiative between ANZ and the Brotherhood of St Laurence. Similar to the StepUp program, they provide loans between $500 and $3000 for household needs and emergencies. There may be a possibility of this program closing though.
Microfinance loans – There are numerous organisations that provide these types of loans. The rates are generally low with no or minimal fees. Be sure to look around and find the best loan based on your financial background and need.
StepUP loans – This is a joint venture between the NAB and Good Shepherd Microfinance. They provide loans up to $3000 with no fees and a low fixed interest rate.
Centrelink help – Depending if you are currently on Centrelink or not, there are different government run initiatives that you may be able to take advantage of. The Newstart program has a variety of financial help options.
Read about similar loan options for people on Centrelink here.
Local community based loans – These types of loans are really dependent upon the organisation and can differ greatly based on location. Typically, the Financial Counselling Australia staff can point you in the right direction whilst also helping with any financial troubles.
The above options are not only for people with a poor or bad credit history, but also low income earners and pensioners. There are other options available, but these include some of the more popular and fair loan solutions. If you are aware of additional loan providers for individuals with impaired credit, please provide them in our comments section.