A Guide to Choosing Wisely by dal.hafidz


									                          A Guide to Choosing Wisely

When you are unfortunate enough to fall on hard times economically, the thought of
finding a loan to suit your needs may be leaning on the impossible. With bad credit and
extreme need, people are feign to make poor decisions and end up putting themselves in a
worse position than when they started looking for a loan in the first place. However, a
little bit of research before going to look for an unsecured loan with bad credit can make
all the difference.

Understand Your Bad Credit First

Prior to looking for an unsecured loan with bad credit, it is essential that you understand
what bad credit means and how you got it in the first place. For starters, know that bad
credit, though a definite negative on loan applications, comes in different flavors, which
means that under certain circumstances lenders will give you an unsecured loan with bad

What does this mean? Well, to put it simply, the calculation of one's FICO credit score is
not really cut and dry. There are several factors that go into it which include your current
debts and past payment history as well as bankruptcies, foreclosures and other
catastrophic financial issues. What the score doesn't reveal is the cause for these reports.
That means, people whose bad credit is a result of catastrophic events related to
unforeseen circumstances such as a job layoff or the housing bubble bust are looked at far
more favorably than those whose bad credit is a result of irresponsible spending over a
long term and too much current debt.

Looking at your Options

Once you understand your credit score, you are ready to look for an unsecured loan that
can help you out of your financial hardship. There are three distinct options available to
you, each with their own pros and cons. They are:

      Personal Loans - this is the traditional loan that many people think of when they
       talk about an unsecured loan. It is generally given in amounts ranging from
       $5,000 to $25,000 and is repaid over the course of 2 to 10 years. This is the
       hardest loan to acquire, however.
      Payday Loans - if you only need a small amount of money for a short period of
       time, payday loans are a great option. These loans are given for small amounts,
       generally $100-$1,500 and then repaid upon the next payday (or two). Hence the
      Unsecured Credit Cards - as the economy begins to recover, access to unsecured
       credit cards, the same cards that you get offers for in the mail, is becoming much
       more lax. Following the Credit CARD at of 2009, you can also rest assured that
       you are protected as a consumer. Generally, credit cards do not offer a loan so
       much as a line of credit that can range from $1,000 to $25,000 or more. You can
       use your card for a large purchase which you pay back with a minimum amount
       each month or you can use the line of credit as a loan between statements.

Choosing Wisely

The key to doing so successfully lies in educating yourself about these options and
choosing that which best suits your needs and lifestyle. Make sure that you pay attention
to fine print and choose wisely.

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