Quick Credit Repair Ideas Before Applying for a Fast Personal Loan

[Feb 5, 2010.]

 

Searching for a bad credit personal loan with a decent interest rate and manageable repayment schedule can be a frustrating process. Understandably, lenders are wary of giving loans to people who have a poor history of repaying loans.

The frustration for the bad credit borrower enters into the picture not from a lack of understanding that bad credit makes personal loans hard to get, but from the realization there are a limited number of things that the bad credit borrower can do to quickly improve his or her credit so that a loan is a possibility.

Here are three ideas for what a bad credit borrower can do before applying for a personal loan in order to maximize the chances of being approved:

1. Identify Loans That Will Not Be Paid Back Anytime Soon

It may seem like strange advice, but one thing a bad credit borrower can choose to do to improve the chances of getting a short-term bad credit personal loan is to forget about paying back certain other loans.

For example, for a borrower who is struggling with a mortgage that is already deeply in arrears, it may not be worth making another payment if a personal loan is the goal. Perhaps better to have that cash on hand to pay another more urgent bill and give up on keeping the house.

This is frank speech, no doubt, but for the bad credit borrower who wants a personal loan, there are some hard decisions to be made. Bad credit personal lenders understand those decisions, and may want to see that at least some shorter-term loans have been paid back, rather than all loans having gone bad.

2. Document Interactions With Lenders

Bad credit borrowers looking for a quick bad credit personal loan do not have time to wait for their creditors to report payments to the credit bureaus, and then for the credit bureaus to generate new data for the bad credit borrower's credit report. That process can take weeks or months.

Bad credit borrowers, then, must be fastidious about keeping documents related to loan repayment. These documents can come in very handy if a bad credit personal lenders wants more information about a bad credit borrower's repayment history.

3. Write a Letter that Explains Why This Loan Is Worth Making


Most bad credit personal lenders do not require a personal letter from the borrower, but at the very least the act of putting down thoughts on paper can lead a bad credit borrower to think clearly about whether or not this personal loan makes sense.

For example, the purpose of the bad credit personal loan, what the funds will be used for exactly, is a key thought that deserves absolute clarity. Putting it down in writing is one way to achieve that clarity.

 

About Author:

Andrew Freiburghouse is a writer and businessman. He has worked as a magazine reporter, tax preparer, screenwriter, copywriter, and loan officer. He graduated from Santa Clara University in 1999 with a B.A. in English. Andrew was born and raised in the City of Los Angeles.