Personal loans can be a godsend when you face a huge tax bill, an unexpected car repair bill, or another large expense. But you might be wondering if a personal loan is even possible if you've had the misfortune of having bad credit.

First of all, it's important to understand the nature of a personal loan. Unlike a home loan or a car loan, a personal loan is unsecured, meaning that you are offering no collateral to secure the loan. That makes the loan inherently risky for a bank or other lending institution.

In order to determine whether you can qualify for bad credit loans, it's first necessary to fill out an application. A typical personal loan application requests your full name, Social Security number, income, and other pertinent financial information. A loan officer must determine your credit worthiness, even in the face of your bad credit history.

With a personal loan, you may not have to undergo a credit check. The money may be deposited within 24 hours into your checking account. You can use the cash for virtually anything—but especially for emergency situations. However, the amount you can borrow may be limited to no more than $1,500.

A loan officer may assist you in making your application more appealing by encouraging you to borrow a smaller amount of money or make payments over a longer span of time. In this way, your monthly payments can be lowered, increasing your chances of getting a loan.

The loan officer must also determine whether you have a steady income. If you have held the same job for a number of years, for instance, you're more likely to obtain the loan. However, if you've changed jobs several times over the past few years, you may be less likely to get the loan you want.

The application process for a personal loan is usually relatively quick. Another advantage is that it does not require a formal closing. The application process consists of a written application, a promissory note, and a payment schedule. As a result, there is less paperwork and hassle involved in obtaining a personal loan than in obtaining a secured loan.

At times, it may be possible to obtain a personal loan from a professional organization to which you belong. The main advantage to such a loan is that the annual percentage rate, or APR, may be much lower than the rate you would get at a traditional finance company. For instance, you may be able to get an APR for as low as 7.99 percent, which would be considered a real bargain for a personal loan. You also may be able to borrow a great deal more money from a professional organization than you would be able to borrow otherwise—the amount you can borrow may be as much as $25,000.

With such a loan, you may be able to defer payments for a period of a few months. You also may face no penalty for early repayment. The terms of the loan may also be quite generous, allowing you to make payments over a period as long as 84 months. You can use such a loan to consolidate debt, pay education expenses, or pay home improvement costs.

Rebuild.org brings you the latest news headlines related to Personal Loans:

• Bank Exits Student Loan Program
  Zions Bank has become the latest financial institution to exit the federal student loan program. Zions happens to be the largest bank in Utah.  Bank officials there have decided to stop accepting new loan applications through something called the Federal Family Education Loans program. An official with Zions said that, given the changes in legislation that have [...]
  [May 14th, 2008]
• Money Guaranteed For Some Student Loans
  Concerns have been voiced over the past few months about the state of student loans many predicting a loan shortage. Colleges and Universities are raising tuition costs during a time when more and more potential students are seeking admission. This coupled together with a weak economy and failing sub prime mortgages are causing many experts [...]
  [May 13th, 2008]
• Wal-Mart, Costco Profit From Recession
  Due to the recent economic recession, U.S. consumers have become more frugal. Their tendencies to try to save money have resulted in surprising profits for stores offering everyday commodities for discount and wholesale prices, such as Costco Wholesale and Wal-Mart. Following a brief slump in 2007, Wal-mart’s stock has gone up from around $45 a share [...]
  [May 13th, 2008]
• Call Intensifies to Scale Back Student Loans
  There appears to be a move underway to scale back loans for college students. There are a number of good reasons for this. For one thing, grants and scholarships are far more attractive than loans, since such financial aid awards amount to ‘free money’ that does not have to be repaid. In addition, grants [...]
  [April 22nd, 2008]
• Experts Recommend Comparison Loan Shopping This Season
  This summer, financial experts are recommending that consumers shop around when it comes to student loan consolidation. While combining several student loans into one can save a college graduate money in the long run, loan consolidation is not necessarily an automatic money-saver in 2007. Flashback to 2006. Financial experts were recommending that college graduates refinance loans prior [...]
  [July 17th, 2007]

Recent articles related to Personal Loans:

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  Mortgages are a popular way for homeowners to secure a loan by using their property as security. While there are many services and companies that can provide mortgage loans to homeowners there are a few of them that may not have the home owner’s best interest in mind. When this occurs, the home owners are [...]
  [April 28th, 2008]