credit

The credit score system allows financial institutions and any organisations that offer credit to asses everyone’s ability to pay back what they borrow. If you have a good credit score, borrowing won’t be too much of a struggle for you. If you’re credit score isn’t in such good shape, conventional banks are likely to turn your applications down or offer you much more expensive terms than they would offer others.

In this article, we’re going to take a look at 5 important tips you should take note of when applying for a bad credit loan. Have a scan through these to get some handy guidance on getting a loan approved when your credit score is low:

  1. Banks are not the best places to start

If you go into a highly recognised and established bank with a bad credit score and ask for a personal loan, you’re setting yourself up for a world of disappointment. Conventional banks are far less understanding when it comes to poor credit history, they are far less likely to accept your application at all, and in some cases, it’s been known for people’s credit scores to be negatively impacted purely because they’ve been rejected for a personal loan.  

At Pretty Penny Loans, we’re far more understanding of those that have a poor credit score and aim to do all we can to help applicants find a solution that best suits your needs.

  1. Understand your own debt to income ratio

Your debt to income ratio can be a very handy tool in appreciating your own ability to repay debts. It’s important to have this understanding so that you are aware of how lenders will perceive your financial circumstances when measuring your suitability for a bad credit loan.

If your debt to income ratio is high, you’ll have a much harder time applying for larger amounts. The better knowledge you have of your own credit standing, the better you’ll be at selecting the right amounts that you’re most eligible to apply for.

  1. Be as honest as possible in your application

It doesn’t do anyone any good when you try to falsify information in loan applications. Whether it’s the amount of debt you currently have, your income level or your bank statements. This information must all be 100% accurate for your application to have the best chance of being approved swiftly.

If there’s any discrepancy between the information you provide and the data that is available through regulated credit channels, your application may be delayed or rejected. So it’s always best to have a truthful and forthcoming approach to the information you share with a lender.

  1. Make repayments perfectly

If you’re approved for a loan while you have bad credit, the last thing you want to do is pay late or miss any payments. The reason you have a bad credit score right now is likely because you’ve been slow in repaying your past debts. If you’re approved for a bad credit loan, you should see it as your last golden chance to correct your credit status.

A loan is an opportunity to prove that you can repay credit responsibly, so it’s vital you take that chance with both hands! Don’t make any repayments late without contacting your lender and letting them know. If you make sure you can complete the repayments fully and on time, your credit score is very likely to increase over time. This is one of the best ways to get your credit status back up to good levels.  

  1. Select a lender that you can trust going forward

Pretty Penny Loans have a policy of looking favourably on customers that have had loans from us in the past. This is a hugely beneficial approach for both parties. If you aim to improve your credit score going forward, it’s a very good idea to take your loan from a lender that promises to approve further loans should you need them in future!  

That’s that! We hope you’ve found this brief list of tips helpful! Having a bad credit score is never the end of the world, as there are always ways to make amends. It’s all about working with your lender to make sure you have a solution that best meets your needs!

Need financial assistance? Use our cost calculator to decide whether or not a Pretty Penny bad credit loan is right for you.

Then to apply, simply complete our quick online application and send us a bank statement. Or call us and one of our friendly staff members will be happy to help. You can use our cost calculator to get an estimate of your bad credit loan repayment amounts. We do our very best to help every kiwi that applies.

If you have any questions check out or FAQ’s or contact us: https://prettypenny.co.nz/how-it-works/

You can also read more applying about for bad credit loans here: https://prettypenny.co.nz/bad-credit-loans/