Best Hardship Loans for Bad Credit in 2024

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Best Hardship Loans for Bad Credit – Being in a situation where you cannot pay bills due to job loss, bankruptcy, or any other circumstances is quite a hard situation to be in. In this situation, the only thing you can think of is how to sort out your financial issues.

Best Hardship Loans for Bad Credit

When facing financial difficulties, a hardship loan is the ideal solution to consider; offering a tailored financial lifeline to help you overcome your challenges .This hardship loan is made specially to help people who are in financial hardship with bad debt. A hardship loan is not an official loan but a loan to help people get through tough times. In this article, you will discover the best hardsip loans for people with bad credit score. Thus, read through this review to the end.

What is a Hardship Loan?

A hardship loan is a type of personal loan taken to sort out financial issues or emergency expenses. When unexpected bills or costs come up, they can cause a well-planned budget to get compromised. Some of these unexpected bills may be for emergency surgery or a trip.

If there’s not enough money or your savings are not enough, getting a personal loan may be a bad idea at this point. Taking on a loan with interest can lead to a heavier financial burden. Whereas a hardship loan provides a more financially friendly alternative, easing your repayment worries.

How Does it Work?

These loans are personal loans that have fixed payments and interest rates that are due monthly until the full payment is made. Once you get approved for a hardship loan, you will get a stipulated sum payment through check or direct deposit.

You can then use the money to pay bills or for any other financial need. Personal loan interest rates increase to 36%, and it has a limited credit history that will lead to high interest. But if you apply with a co-signer who has good credit, it will help you get a better rate.

5 Best Hardship Loans for Bad Credit

There are some hardship loans for bad debt you can consider getting. These lenders have a preferable interest rate and repayment plan. Below, the best hardship loans for bad credit to get this year.

Upgrade

This hardship loan is a type of loan that creates accessible mobile and online credit and banking services. Over the years, this lender has made over $3 billion in credit available to over 10 million applicants and is still counting. Upgrades make loans available to borrowers who have bad credit reports. They offer loan amounts ranging from $1,000 to $50,000.

Upstart

Upstart has been able to approve over 27% of borrowers under a traditional lending model. This lender is not required to be a top lender for borrowers who qualify for a more competitive rate. Its minimum 300 credit score makes it a good option for borrowers with fair credit. Upstart gives a flexible range of loan options and amounts ranging from $1,000 to $50,000, so there is no need to borrow more than your actual needs.

LendingPoint

This is an online lender that offers loans to borrowers in only 48 states, including Washington, D.C. Borrowers who are not from these states are not eligible for this loan. This loan range from $2,000 to $36,500, and their repayment plans range from 24 to 72 months or 2 to 6 years.

Prosper

Another hardship loan to consider is a prosper loan. This lender is a peer-to-peer lending platform. It offers a flexible personal loan amount ranging from $2,000 to $50,000. It also offers prequalification for borrowers to check what rate they qualify for without harming their credit. In less than 3 days, borrowers can access their loan after approval.

Universal Credit

Universal Credit is an online lender that gives personal loans ranging from $1,000 to $50,00 through its partners. It has a repayment time ranging from three to seven years. It is a good hardship loan for those with bad debts.

How to Apply for a Hardship Loan

It is quite easy to apply for a hardship loan. It works just like applying for other personal loans. Follow the below steps to apply for a hardship loan.

Go through your credit history

Checking your credit history before taking a loan does not hurt your credit score. It helps you identify opportunities to have your history cleaned up.

Compare interest rates:

Comparing different lenders’s interest rates helps you identify the most affordable one, so you don’t go for one that will hurt your score.

Find a co-signer

If you can’t qualify for a good interest rate on a hardship loan because of your credit score, getting a co-signer with a good credit score is a good idea. It will help you get a lower interest rate.

Submit the required financial documents:

Most lenders may request some financial documents, such as bank statements, or you may be required to pay stubs to verify your income while the loan process is ongoing.

Review and sign off on loan documents:

After you get approved, you will receive a loan contract for you to review and sign. This is a chance for you to confirm if you are comfortable with the loan payments before you agree to the loan.

Get loan funds:

At this stage, you have completed the loan process, and you will be given your cash through a direct deposit into your bank account or check.