Peer-to-peer lenders make loans using funds collected from thousands of individual investors. Some bad credit options are available – loans are approved on a case-by-case basis – but interest rates can be as high as 36%. You can use these loans for any purpose: debt consolidation, starting a business, or even purchasing a car.
LendingClub Bank offers a peer-to-peer lending platform where you’ll be lent money from real investors, rather than a giant corporation. You can check your rates in a matter of minutes with no effect on your credit score. 95% – so not so terrible, especially when compared to high interest credit cards.
Prosper f ocuses on personal loans. Their application takes just a few minutes, and you can get approved for loans up to $40,000. Prosper offers a number of term lengths ranging from three to five years, so you can pick the one that fits your budget. Plus, all your payments are at a fixed interest rate, so you don’t have to worry about your payment terms suddenly changing.
They say on their site that the average APR on their personal loans is 15
It’s important to read loan terms carefully and understand all the potential costs of a loan. These can include fees above and beyond the interest rate (APR). This is especially true of loans for consumers with bad credit.
APR. This is going to make up a chunk of your loan, so you want to make sure you’re getting the best interest rate you can qualify for. Do your homework – really – and check around for your best rate options. With poor credit, your choices are more limited, but you still have choices and shouldn’t settle for the first lender that says yes. Even a small difference in APR can add up to hundreds or thousands of dollars in additional interest payments over many years.
Your loan terms. How long do you have to repay the loan? Make sure you are able to pay off the loan early without penalty. Continue reading “What to look for in a lender”