Although the chances of bagging a loan with bad credit and without a guarantor are slim, there are still options. You can use your existing collateral to get a loan with bad credit. The following are some of the popular options.
- Gold loans can be obtained without a guarantor even and with bad credit. As the lender has the advantage of the collateral, the loan is easily sanctioned. The interest rates may range between 11% and15%.
- A loan against fixed deposit is another popular option to get a loan with bad credit. To get this loan, you need to have a fixed deposit with a bank. In case of a default, the lender will retrieve the amount from the deposit.
- Loan against mutual funds, insurance schemes, and securities are other options that a person with bad credit can make use of in times of financial need.
- Alternatively, a debt consolidation loan can be availed to pay off all bad loans, which will also help you to improve your credit score simultaneously. After getting the loan, make regular repayments to improve your credit score.