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You’re credit score is used to determine your eligibility for various lines of credit. Let it go down, and you’ll find it harder and harder to be accepted for finance products like loans, credit cards, and payment plans for new purchases. In this post, we’re looking at the best ways to find cash loans with bad credit in New Zealand. Have a read through and see if any of these options suits your needs.    

Payday loans

This is the type of loan we offer at Pretty Penny Loans. Where typical personal loans are largely based on long-term arrangements, short-term loans are meant to be paid back as soon as you can – usually by the time you get your next payment from work. The other way they differ, is in the way that your application is assessed. With a long-term loan, your credit score plays a big part in determining whether or not you are a good candidate for the loan. This is not the case with short-term loans.

With our short-term payday loans, we don’t care much about your previous history with credit. The most crucial thing for us to assess is whether or not you have the income necessary to afford the loan you need. If you have a strong steady income, we know you’ll be in a position to pay back what you owe without issue when your next payday comes around.

Payday loans are best suited for emergencies rather than personal purchases. If you’re running low on cash and just need a quick injection of funds to get you to your next payment from work, this is where payday loans can really help. You don’t need a high credit rating and the payout can be made within 24 hours.

Secured loans

This is one of the more common ways you can access a loan with bad credit in New Zealand. Secured loans are special types of credit specifically designed for those with poor credit history or no history at all. With these loans, you’ll have to pay a deposit upfront in order to qualify. The deposit acts as the loan providers security. In most cases, the deposit amount is equal to the amount you want to borrow.

These loans are not useful if you’re in a pinch with cash. They are more suited to those who have money to spare and want to build their credit score up by proving they can handle credit responsibly. Money management is crucial when you’re trying to improve your credit score. Fail to pay your secured loan repayments and the loan provider will keep all or some of your deposit.

Pawn shop loans

Need cash in your hands right away and have some precious items to trade? Then a pawn shop loan might be an option for you. Like payday loans, this option gives you access to the funds as soon as possible. You’ll have to take your items to the shop and then agree it’s value with the vendor. If you accept the terms, they’ll give you the amount in cash and take the item into their custody. If you don’t pay back what you owe in time, they get to keep the goods.

There are several major disadvantages to dealing with pawn brokers, so you have to be careful. Firstly, it involves handling cash and carrying your precious items in public — this holds obvious risks. On top of that, if things go wrong with paying them back, you’ll lose ownership of the items you’ve pawned. The only way you can get them back once they are owned by the broker is to buy them back at a much higher rate than you might think they’re actually worth.

At least with a payday loan, if you think you might miss a payment, you can get in contact with us and we’ll do our best to help by moving your payment dates around. This won’t be possible with pawn brokers as they make far more profit on items that they are allowed to keep and sell at market value.

These are the easiest ways to get a loan with bad credit in New Zealand. It’s all about picking the option that suits your particular needs best. If time is an issue, a payday loan will get you the money safely and within 24 hours. If you’re looking to boost your credit score more than anything else, then take a look at secured loans. Pawn shop loans should be seen as a very last resort in most cases. We hope this quick overview has helped!   

Read more about bad credit loans here, or in our previous blog post: Best Options For An Easy Loan With No Credit Check NZ

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