FINANCE
Tell us your financial woes…
- Low credit score?
- Already paying mortgage?
- No income source?
- Can’t find a lender to trust you?
What if we told you that we have the answer to all these questions?
Yes, you can get a loan despite having bad credit if you are already paying mortgage, have no income source, and can’t find a lender to trust you!
Let’s get right to the point, shall we?
Get a Loan on Bad Credit
Despite your spotty credit history, a lender like pocket cash will approve your bad credit loan application. In case you are wondering what your credit score is, here are the ranges set by different credit bureaus:
| Credit Score Range | Equifax | illion | Experian |
| Excellent | 833 – 1200 | 800 – 1000 | 800 – 1000 |
| Very Good | 726 – 832 | 700 – 799 | 700 – 799 |
| Average | 622 – 725 | 625 – 699 | 625 – 699 |
| Fair | 510 – 621 | 550 – 624 | 550 – 624 |
| Poor | 0 – 509 | 0 – 549 | 0 – 549 |
When you have a bad credit score, a lender asks for the following things:
- Personal ID (Proof that you’re 18)
- Proof of income
- Proof that you are a resident of Australia
Your lender might make a soft inquiry to determine how low your credit score is. This information helps them decide how big of a loan they can give you and what the interest on it will be. The loan’s interest rate and origination fee are connected to the loan amount. For example, the APR on a $100 loan will be 4% and a $15 origination fee.
Get a Second Mortgage
A home equity loan, also known as a second mortgage, is a type of loan you take out against the equity you have built in your house. For example, if your house costs $300,000 and you have paid $100,000 in monthly payments, you can use this percentage of the house to finance your loan.
However, keep in mind that since you are borrowing against your house, it will be used as collateral. Meaning: If you default on the loan, your property will be seized. Nevertheless, this loan is a great option for people who want a bigger loan. With the low interest rate, a home equity loan allows you to use it for any purpose. Moreover, if you are spending it on home renovations, the amount will be tax-deductible.
No Income Loan
Don’t have any traditional source of income?
No worries! You can still get a loan by showing your Centrelink payments. The following benefits are counted as income:
- Disability Support (NDIS) Pension
- Aged Pension
- Veterans’ Affairs Pension
- Parenting Payment
- Carer Payments
- Child Care Subsidy
- Job Seeker payments
- Family Tax Benefits A and B
Since your proof income is the only stable thing that is a requirement of all loans, it’s important to show the lender that you receive a steady amount from any source. This can be your side gigs, your spouse’s income and Centrelink payments.
Finding a Trustworthy Lender
Let’s say that you have a low credit score. The lender asks for proof of income, and you show him your Centrelink payments. After looking at the information you have provided, he rejects your application saying that he doesn’t think you can keep up with the weekly payments. After much negotiation, the lender still doesn’t agree and ask you to consult another lender.
However, you have done your research, and the online reviews said he is one of the best lenders in your area. You approach the lender again and ask if your application would be approved with a co-signer. The lender asks for the co-signer’s information, and you present your friend’s documents. She has a good credit score and a stable job. She also earns three times more than you. The lender agrees to give you the loan if your friend takes responsibility for default payments.
This often happens when a lender looks at your credit history and feels that you won’t be able to pay back the loan. Since they take the bigger risk, they need to make sure that you are a liable candidate.
There are thousands of lenders available online you can approach for a loan. Always consult multiple lenders before deciding on one. Some of the factors you should consider before finalising a lender include interest rate, charging fee, and loan terms. Use an online calculator to determine how you can afford it so you can manage your finances accordingly and stay within your budget. If your application has all the right documents, you will probably receive your loan on the same day you apply for it.
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