Poor credit makes you risky in the eyes of lenders. Thankfully, there are reputable alternative online lenders have no difficulty providing a bad credit loan. Let’s see how you can repair your poor credit and get bad credit business funding.
Improving Bad Credit & Obtaining Bad Credit Loan
Based on the FICO score, which is the most common one in the U.S., poor credit is defined a score between 579 and lower. You should regularly check your report for inaccuracies. Just visit annualcreditreport.com and get your report for free.
The good news is that you can work on improving your poor or fair credit. Here’re the basic points to focus on when dealing with bad credit. By the way, it may take months or years to reach positive results. So:
First, get your credit report. If you’re planning a major purchase in the near future, apply for your credit report at least 3-6 months prior to turning to a loan provider so to have time to address any issues.
2. Have you found errors? Don’t fail to dispute them by writing a letter to the credit reporting agency. The Federal Trade Commission’s (FTC) website provides a credit dispute letter.
In case, the inaccuracy is true, the negative information wont’ go away for about 7 years. Be aware that bankruptcy will stay there for 10 years. Negative items on could mean the following:
3. If there are no inaccuracies, start figuring out what could have decreased your credit score. Are there any overlooked bills or forgotten accounts?
The good news is that there are expert alternative online lenders in the high risk space that offer a bad credit loan with the best possible terms and the cheapest possible rates in the industry. So, even if you’ve got bad credit or no credit at all, not everything is lost for you.
4. Pay attention to the so-called utilization rate, which you can reveal by dividing the credit you’re using by the amount you have. This rate should always be less than 30%.
5. Turning to an agency in the credit repair field can also help. Only, be attentive to not to appear in the scammer’s trap. Search for a BBB-accredited company with verified online reviews.
6. After figuring out all these things, work on building your credit. Consider becoming an authorized user.
7. A credit score-raising program such as Experian Boost can also help.
8. Avoid applying for new credit cards or closing several old accounts if you don’t have an overall strategy. Instead, consider getting a loan designed for improving credit, or a secured card.
9. Focus on bringing current your past-due accounts.
10. Cut the balances on your revolving accounts.
11. Credit that’s not a must can hurt your score, so don’t apply for it.
As you see, bad credit isn’t the final word. You still have chances of getting access to additional working capital and not only. The points above can help you with building better credit to enjoy the best deal for your company.
Author Bio:Michael Hollis is a Detroit native who has helped hundreds of business owners with their bad credit loan solutions. He’s experimented with various occupations: computer programming, dog-training, accounting… But his favorite is the one he’s now doing — providing business funding for hard-working business owners across the country.