Bad Credit Loans

A loan may be the best option you have right now to change your situation. Nevertheless, banks and other institutions are unwilling to trust someone with a bad credit record. You may first want to regain financial credibility, and one of the first steps is to use a credit card for bad credit, which will give you trustworthiness and financial responsibility and later, independence.

If you don't wan to get another " no ", you might read the following pieces of advice, which are to be put in action in the case of an interview with a financial institution.

# Doing it right

Do not present yourself in front of an adviser without having perfectly understood your project. If you want a loan for your business, you have to know perfectly the market situation and evolution, why your business model is good, you competitors, your product of service feasibility, etc. No matter the reason, this work includes having perfectly understood your why's (why this project, why now, why you, why here where you are), the needs you have and how much do you need; do not be afraid to state your need.

You must know your needs and the environment in which you are evolving à la pointe des doigts. It will tell the adviser that you are a wolf seizing an opportunity (for you and for institution) and not a sheep turning around without direction.

# Redeem yourself

It should not be too long and it always shows humility, self-awareness and intelligence when some of your first sentences clearly states why, how you ended up in this bad situation and how well you have learned the lessons. It spares the interviewer to say it to yourself, specially if he knows you for a long time. But do not try to put the fault on something or someone else, nor try to be pitiful, as these will put a shadow of ignorance and contradiction in the whole speech.

# Show your skills

You should convince the interviewer that you are a person capable of taking the responsibility for the loan; you should state how good at your field you are or how good your financial situation will be (show him numbers), because you have taken the necessary steps towards it.

# Show their interest

" If you want to make friends, don't talk good about yourself " applies here too. Do not tell them how good your situation will be and how happy you will be if they give you the loan, because they do not care. They care bout their interests.Tell them how much their will harvest on your efforts and how much the chances of success are high because you have done your homework (#1) and you are capable of undertaking the task (#3).

# The feasibility

The time, if you have some, you ask for a loan counts too. Taking into account inflation, being on a phase of progress for the country and when your special field is booming, puts points in your side. The most important factor will be your future capability to pay on your due date and the potential interests, so you should not make the same mistakes and be financially responsible.

# Misc

In respect to the tone you are going to use, never be familiar (" bucks "), nor too formal. Don't try to pretend you know finance by using financial terms, because if you really knew finance, you would not be in this bad financial situation. Use common terms precisely and with meaning.


Later will be published a paper telling how to choose the perfect institution to get a loan, even with great difficulties.

Image : © Kevin Dooley, CC BY 2.0.

Credit Cards For Bad Credit

Choosing the right credit card is one of the first steps towards financial responsibility, specially after a bad management. Credit cards for bad credit are good if you choose them right. Nevertheless, due to the countless credit cards available, choosing the right one may be difficult. Therefore, here is a non-exhaustive list of credit card for bad credit.


1. First Access VISA Credit Card

Annual Percentage Rate for Purchases : 29.99%

APR for Cash Advances : 29.99%

Set-up and maintenance : 

" The Annual Fee will be assessed before you begin using your card and will reduce the amount of credit you initially have available.Based on your initial credit limit of $300.00, your initial available credit will only be $225.00 ($196.00 if you choose to have an additional card). You may still reject the plan, provided that you have not yet used the account or paid a fee after receiving a billing statement. If you reject the plan, you are not responsible for any fees or charges. "

Paying interest :

" Your due date will be a minimum of 21 days after the close of each billing cycle. We will not charge interest on new purchases if you pay your entire balance by the due date each month. We will begin charging interest on cash advances on the transaction date. "

Minimum Interest Charge :

" If you are charged interest, the charge will be no less than $0.50. "

 Processing fee : 

$89.00 (one-time fee).

Annual fee : 

$75.00 the first year, then $48.00 annually.

Monthly Servicing Fee : 

None the first year, then $75.00 annually ($6.25 per month).

Transaction Fees : 

Either $5.00 or 5% of the amount of each cash advance, whichever is greater.

Late Payment Fee : 

Up to $37.00; up to $15.00 for Iowa residents.

Returned Payment Fee : 

Up to $37.00; up to $15.00 for Iowa residents

Review :

" Good as a credit builder for those with bad credit. I'm using for gas and small purchases and payoff the balance every month. Keeping overall utilization low. Once minor hiccup with customer service. I was charged double the annual fee to my card. This caused my available balance to be much lower. I called customer service and they returned the other $75 fee to my available credit limit within 2 days. "

" [...]  Within a year on the First Access Visa, I got several credit limit increases,which eventually led to an unsecured card AND significant improvement in credit rating/worthiness. " 

2. Capital One Secured MasterCard

Annual Percentage Rate : 24.9%

APR for Cash Advances : 24.9 %

Paying Interest : 

" Your due date will be a minimum of 25 days after the close of each billing cycle. We will not charge interest on new purchases if you pay your entire balance by the due date each month. We will begin charging interest on cash advances on the transaction date. "

Annual Fee : 

None

Transaction Fees : 

Either $10 or 3% of the amount of each cash advance, whichever is greater.

Penalty Fees : 

Up to $35.

Review :

" Many years ago, when I owned better credit, I had a Capital One card and was overall very pleased with the services provided. Now that I have poor credit and am on a journey to rebuild it, Capital One has made it possible for me to do so with them via a secured card. I use the mobile app to check balances and make payments and it is great! My only bone to pick is that it takes upwards of a week to update my available credit and this is AFTER the funds have been debited from my bank account! What a nuisance at times. :( (Not to mention the app states available credit will be available/updated within a few business days). "

" Disappointed in the annual fee along with a low balance disappointed in me annual fee along with a low balance. Slow to report to credit bureau and slow to process payments. No extra rewards with a card. It is useless other than to help build my credit. Will not be getting another Capital One card. "

3.USAA Secured Card® American Express®

Annual Percentage Rate (Purchases, Cash Advances, Balance Transfers) : 

9.90% to 19.90% based on your creditworthiness and other factors. This APR

 will vary with the market based on the Prime Rate.

Paying interest :

" Your due date will be a minimum of 25 days after the close of each billing cycle. We will not charge interest on new purchases if you pay your entire balance by the due date each month. We will begin charging interest on cash advances on the transaction date. "

Minimum Interest Charge :

None.

Annual fee : 

$35.00

Transaction Fees for Balance Transfers : 

3% of the amount of each transfer (maximum fee per transfer $200).

Transaction Fees for Cash Advances : 

3% of the amount of each cash advance (maximum fee for each convenience check: $200). Fee waived when transferring funds electronically to a USAA deposit account.

Transaction Fees for Foreign Transaction : 

1% of each transaction in U.S. dollars.

Late Payment Fee : 

Up to $35.00

Returned Payment Fee : 

Up to $35.00

Over-the-credit limit : 

$0

Review :

" I am only in the beginning stages with this card. When I called to check on this account, I was very disappointed that my wife was not added on the CD. I called and was told the account could only be individual with my wife as an authorized signer on the credit card only. She can't be a joint owner of the CD. I did fill out her information on the application and thought this was joint. Was told it was for income purposes only. I do not like having any account without joint names. We have no other accounts this way. Also after reading some of these reviews I am also disappointed that the payments I make from my USAA Che king account are not immediate and could be days before my available balance is increased by the payment. I pay off my account each month. There might be a month I want to make a large purchase and can't pay the account down to accommodate this purchase. I will wait and see if the card actually works for me. "

" I have to give USAA credit this did raise my credit score over the year and half that I've had the card. USAA has been amazing as always with there customer service as well. Even so, due to not being able to transfer the line of credit to a unsecured card I have to recommend going with a different bank for a secured card.

I was very surprised when I called in that there is no process to graduate the line of credit to a new unsecured card. Instead USAA said I would have to apply for a new line of credit. This is going to eliminate what was my oldest line of credit and put another hard pull on my credit score - ultimately lowering my credit score. This really defeats the purpose of a secured card.

For now I am closing my secured card and getting my deposit back but I'll probably stick with my local credit union's credit card to avoid yet another hard pull. "

You may check and confirm yourself the information contained in this article, as they may change. This article is for information only and does not represent the overall market, nor is it responsible of the use you make of it.

Image : © Sean MacEnteee, CC BY 2.0.

To learn about structured settlements, visit www.breakingfinances.com/structured-settlements-guide/