Bad Credit Loans Online in Spencer Iowa

Do I have a bad credit score?

According to FICO, your credit score is calculated based on five major factors:

• Payment history (35 percent).
• Amounts owed (30 percent).
• Length of credit history (15 percent).
• New credit (10 percent).
• Credit mix (10 percent).

If you neglect one of these factors in your personal finances, your credit score will drop. For example, repeatedly making payments late or not making them at all will have a major impact on your score because your payment history makes up  35% of your credit score. Things like bankruptcies, foreclosures and high amounts of debt relative to your income could also result in a bad credit score.

Because payment history and length of credit history can make up 50% of your credit score, individuals with little or no credit history may find themselves with a lower credit score due to their lack of credit history. Borrowers with little or no credit history may find it easier to raise their credit score compared to individuals with damaged credit history.

How to get a bad credit loan in Spencer Iowa?

Finding a personal loan with bad credit in Spencer is possible, but it requires research and effort to find the most affordable loan possible. We at IAloan do not suggest turning to payday lenders as their interest rates are often quite high and can compound. Here is IAloan‘s step by step guide to getting a personal loan if you don’t have strong credit.

1. Know your credit score. Learn where your credit currently stands by getting a free credit report. You are legally entitled to at minimum one free credit report every year from each of the credit reporting agencies. Take a look at your credit score, see where it is lacking, and make note of what you can do in the future to raise your credit score.
2. Add potential loans into your monthly budget. Evaluate your income and budget to make sure that you can support an additional monthly loan payment. You can use our loan calculator to determine estimated monthly payments, which you can then add to your budget to determine if you can afford the monthly payment.
3. Research your options. Research personal loans for bad credit online, ensure you read the fine print, and look for independent reviews about lenders.
4. prequalify to see your loan options. Before applying for a loan online, many online lending marketplaces allow you to check whether or not you will qualify with multiple lenders without doing a hard credit check. This is a great way to shop around for a bad credit loan without impacting your credit score further. We offer a personal loan marketplace that allows you to check your prequalified options with lenders in Spencer.
5. Look into secured loans. Secured personal loans are offered by some lenders and are easier to get if you have below average credit. With a secured loan, you will have to put up an asset like your home or car as collateral, these loan options typically have lower APRs than unsecured loans.
6. Add a co-signer if necessary. With a Co-signer with good credit, you may qualify for more loans with more competitive interest rates. The co-signer will have to take on partial responsibility for the loan and may be required to pay back the loan if you fall behind on payments.
7. Get ready to apply. When applying you’ll likely have to provide financial documents like pay stubs, tax documents, employment information and more. Having these documents ready when you apply, you’ll speed up the process of finalizing your loan.
8. Be ready for a hard credit check. After the initial prequalification, lenders will perform a hard credit check before finalizing and funding your loan. A hard credit check can temporarily damage your credit, though you should be able to recover the points lost once you begin making payments on the loan.