There are many people whose credit was destroyed as a result of the financial crisis of the late 2000s. Bad credit history and a bad credit score can plague a person in a number of ways. Potential employers are now using credit checks to examine the credit history of potential employees. Bad credit normally means that a person will not be able to qualify for a loan. However, there are a few types of bad credit loans for those with a less than stellar credit background.
If you have a steady job, you can use your next paycheck as collateral for obtaining a loan. Payday loans are short-term loans that are for relatively small amounts of money – usually a few hundred dollars. They are particularly useful in emergency situations such as an unexpected car repair. The borrower may not have the money at the time of the repair, but will as soon as the next paycheck arrives. As long as the borrower can prove a steady source of income, a payday loan is normally approved within an hour or two.
Loans At A Pawn Shop
If you have some items that may be worth something, you can always take them to a pawn shop. The pawnbroker will examine your items and offer to loan you a certain amount of money. Items such as jewelry, electronics, guns, and others can usually give you several hundreds, if not thousands, of dollars. Pawn loans are typically short term and if not repaid, the pawnbroker can sell the items to recover any losses. When you pawn an item, the pawnbroker keeps it until the loan has been repaid.
Car Title Loans
If you own a vehicle that is paid off or nearly paid off, you can secure a car title loan. At Embassy Loans of Florida, a potential borrower fills out an application and presents documentation of identity and residency. The borrower must possess a clear title to the vehicle being used as collateral. Embassy Loans, like other title loan companies, will examine the vehicle and determine its value. They will loan up to 50 percent of the vehicle’s value. The loan is not based upon credit, so no credit checks are necessary. Unlike a pawn loan, the borrower gets to continue to use the vehicle while the loan is being repaid. If the borrower defaults, the lender can take possession of the vehicle. The lender will then sell the vehicle to recover any losses.