Are Bad Credit Loans Safe?

No matter your credit history, pretty much everyone needs credit (eg. a car loan) at some point in their lives – but are bad credit loans safe?

Finding out is pretty important as having bad credit can leave some people in a delicate position.

We investigate and answer the question; are bad credit loans safe?

In short: Yes they are, if you take the proper precautions and find a reputable broker and lender.

These days we hear a lot about bad credit loans. Are they really what they claim to be and are they a safe bet when it comes to financing? 

Having bad credit won’t stop you needing a car to get to work or ferry family members.

A bad credit loan explained

It means a loan from a lender (eg. a bank, financial institution) that specialises in lending money to people with bad credit. These lenders have policies, staff training and experience in helping people with bad credit and as such, typically they charge a higher interest rate and have more stringent lending guidelines, for example capped borrow amounts.

It’s not surprising that most people are somewhat sceptical when it comes to bad credit car loans as many of these lenders are not the ones we’re familiar with, such as the big banks for example.

DYR (Do Your Research)

In the past, we’ve heard a great deal about loan shark rates, and loans where a payment that was only a day late would result in fees and other problems. There’s plenty of horror stories to go round.

Luckily, avoiding becoming a horror story is easy.

There’s good news if you have bad credit

Today’s bad credit lenders are, for the most part, very reputable. Of course, as with anything, it’s important that you do your homework and ensure the lender you are planning to get your bad credit loan from has a stellar reputation.

Loans For People With Bad Credit has a panel of bad credit lenders who are all accredited, reputable and, of course, legitimate businesses and organisations.

A bad credit loan offers you the opportunity to begin to rebuild your credit. These lenders can be found in a number of places. There is likely at least one right within your community. There are also many of these lenders available online, offering a variety of loan types.

Our team is determined to match your circumstances to as many possible lenders and loan options as we can. That means, before committing to anything, you’ll be able to see all the details, have a think and do any research or ask any questions you may have.

From what lenders are bad credit loans safe?

Whether you are looking for a bad credit home loan, in need of a second chance car loan, or hoping to get your first personal loan now that things are turning around, bad credit loans today are a great way to begin to rebuild your credit, and to get that loan you so desperately need right now.

So, what should you look for when seeking a lender for bad credit loans?

• Do they post a phone number and address in Australia?
• Phone them to verify their existence if you require peace of mind
• Check with ASIC 
• Are they asking for more information than is generally requested? Proceed with caution
• Is the interest rate way too high? Look for another lender

It’s very important to check your credit file (for free) as well, even if you choose to not get a loan in the end!

Checking your credit file lets you know exactly where you stand as these documents show exactly what lenders will see too, for example;

• Past credit enquiries
• Repayment history
• Defaults and late repayments
• Outstanding debts

A quick search online can tell you a lot about any particular company. Make use of this resource.

Are bad credit loans safe? SUMMARY

If you select a reputable lender through a reputable broker / bad credit organisation, you’re in good hands.

Going it alone and trying to tick every little box (and learn them all) can be pretty daunting – and leave you open to problems in the future.

If you have any questions or are ready to test the water and get some options matched to your circumstances, contact the Loans For People With Bad Credit today.

We’ll provide you with everything you need to know and, of course, we ONLY work with legitimate, registered and reputable lenders.

Angela Monroe

Angela Monroe is the Community Manager at The Positive Group, specialising in giving people the information that they need when they need it, and putting you on the path to a fair financial future. She has 8 years of experience in helping Australians find the right finance solutions, and regularly contributes articles to empower Australians with the knowledge they need to become financially healthy.