Financial Despair: What Are Your Options When You Have Bad Credit?

| June 2, 2017 | 0 Comments

bad creditFew things in life make you feel more despondent than not having the money you need when you need it. If you have bad credit, this is a reality that you know only too well.

However, there are financial helps available to you, even if you have bad credit. Here’s a look at four ways you can get yourself out of a financial bind if you have bad credit.

1. Short-Term Loans

Although many people don’t care much for financial helps like payday loans or installment loans, they can have their place. If you have poor credit and you need cash fast, these may be viable options for you.

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You should be aware that they do come with high interest rates—as much as 300%. However, they can also get you out of a tight financial jam, plus many of these programs give you the opportunity to rebuild your credit, so they may be worth the risk.

Just make sure to pay them off quickly and only use them in an absolute emergency.

2. Car-Buying Options

For those who live in areas without good public transportation, not owning a car isn’t an option. However, if you have bad credit, financing a car often isn’t an option, either.

That said, there are car companies that will finance someone with bad credit. Some of them allow you to buy the car outright, using their in-house financing options.

Others, like Auto Start, actually offer consumers leasing programs. Best of all, these types of establishments are willing to meet you where you’re at. Many will approve you for financing by using just some of your current paystubs and your proof of residency.

3. Credit Cards

Credit cards are a good way to re-establish your credit after a financial downturn like a bankruptcy. However, getting credit cards under those circumstances is sometimes dubious.

However, some companies have credit cards for people with bad credit and, as The Simple Dollar points out, many of these cards even have a pre-qualification process. This helps you because you don’t spend your time filling out long applications for credit cards you don’t qualify for.

4. Saving Up

Eventually, you’ll want to conquer some of the habits that got you into financial trouble in the first place. Overspending and living without a solid budget can create many financial emergencies that wouldn’t exist otherwise.

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One way to prevent future financial emergencies is to save for them. If you save even a hundred dollars a month, your rainy-day fund will have $1,200.00 (plus interest) in one year’s time.

You can then put that money toward paying for the new tires on your car, an accidental broken window, or some other mishap.

Help with Financial Issues

The ultimate goal of most people with bad credit is to improve their financial situations. While long-term financial health eventually includes saving for emergencies, many people wind up having emergencies even before they’ve managed to save up the money to handle them.

In those cases, it’s good to have a backup plan. Payday loans, credit cards, and even auto financing can be lifesavers for those people trying to rebuild their credit. If they’re used correctly, all of these financial tools can put even those with really bad credit back on the road to financial recovery.

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