If you do not have good credit ratings because of financial problems or you are trying to build your credit it can be difficult for you to get a loan from traditional banking institutions. Moreover, if you are not aware of the changes which have been implemented to credit reports it will be difficult for you to fathom the factors that can affect your credit ratings and leave you confused about how you can make the changes desired.

Regardless of the kind of situation you are facing you will be surprised to understand you have more options available to you then you believe. We are giving you a few ways to get a good loan despite having bad credit ratings.

[su_quote cite="Samuel Rutherford" class="cust-pagination"]"Let your children be as so many flowers, borrowed from God. If the flowers die or wither, thank God for a summer loan of them."[/su_quote]

Getting A Loan With Bad Credit

When your credit ratings are bad or negligible you are viewed as a high-risk customer who may default on the repayments leaving the lender with a set of problems. It is a foregone conclusion that you will not fit the standard lending guidelines unless you can improve your credit ratings. Traditional banking institutions have stipulated certain guidelines which they follow without exceptions.

If you have turned down for a loan and do not want to borrow money at high subprime interest rates here are some alternatives for you to consider.

Using A Home Equity Line of Credit

You can get a low-interest tax-deductible line of credit which you may use for any expenditure if you have significant equity in your property. You must, however, realize you are tapping into the equity of your home and it would be in jeopardy particularly if you are unable to repay the loan. However, if you have a reliable income and are determined to make the payments on the equity line according to schedule this is an inexpensive option regardless of your credit ratings.

Making an Application with Credit Unions

Credit unions function just as banks but their ownership lies with their members who are usually from a particular industry or are living in the same location. They are also nonprofit organizations that are sharing their earnings with their members by charging them lower fees and offering better customer service.

Pay a visit to a credit union in your location for a discussion about getting a personal loan. Do not forget to compare loans from different institutions to understand whether you are getting the lowest interest rates before you make any commitment to putting your signature on the paperwork.

Getting A Peer-To-Peer Loan

The concept of peer to peer loan has become popular since 2005. This is an online platform which allows you to borrow money directly from an individual instead of a lending institution. The concept has been growing significantly because the process is streamlined and borrowers are not required to pay high-interest charges.

You are just required to post a loan listing including the amount you are looking to borrow and the reasons you need the money for. The investors will be looking at the listing and selecting the ones that meet their criteria. The lenders will be screening all applicants and will also check your credit ratings. Your credit scores will still be a factor but an individual lender could be more inclined to meet your requirements than traditional banks.

Borrowing Money From Family or Friends

If you are not successful with peer to peer lending you can perhaps consider borrowing money from family and friends that can help you. You should be treating the loan as a business on the action which is clearly documented and recorded legally.

Ensure that you record complications by creating an agreement in writing which includes the interest rates, the payment terms and any collateral you have offered for the loan. Loans from family and friends should be used as a last resort because you wouldn't want to invite the risk of losing a relationship over a bad debt.

[su_quote cite="Bryant H. McGill" class="cust-pagination"]"Never expect a loan to a friend to be paid back if you want to keep that friend."[/su_quote]

If none of the above options work for you, you can have a discussion with a cosigner who understands your situation and is willing to support you. However, it does not give you the freedom to go easy on the repayments after you have received the money because you will be putting your cosigner into trouble.

As you can see getting a loan with bad credit ratings is not impossible and that are options which are available if you are willing to make some efforts to find them.