Unexpected crisis situations can arise in anyone's life and they often end up making you feel distressed and vulnerable on financial terms. Losing a job during employee’s layoffs or disruption of house/car in a storm or earthquake.
What are the money options available for people with bad credit in such scary situations? Don't worry! Emergency loans are there to pull you out of your misery.
Emergency loans are instant personal loans which provide short notice debt without much documentation and processing. It is a great option to pay off urgent unexpected expenses like vehicle payment, hospital bills, disaster damage or any other emergency financial crisis situation.
One of the biggest advantages of emergency loans over other loans is quick approvals which is precisely why they are called “emergency loans”.
Eligibility / Features
Most emergency loan approval criteria are the same as personal loans. Age, income, work experience, etc for an applicant to qualify for an emergency loans for bad credit are listed below.
- Age requirements are above 21 years to 60 years.
- Interest rates range from 18% to 36% annually.
- No collateral is required.
- No guarantor/co-signer is needed.
- Work experience of 2 years & above.
- Loan period varies from 6 months to 5 years.
- Resident of the city for more than a year.
- Monthly income of at least 20k is required for salaried individuals.
- Documents – Address proof, identity proof , bank statements, etc.
How to get an emergency loan with bad credit?
Your credit report holds primary importance when it comes to any loan approval. Applicants with poor credit history are rejected straight away. Getting into a money crisis with a bad credit score is even worse.
Emergency loans have an advantage over other loans during such unprecedented times. Let's have a look at options available for emergency funding to people with poor or credit history at all.
1. No credit check emergency loans
Short-term loans are available for people with bad or no credit history. No credit check emergency funds are provided by credit unions without any credit check of the borrower. Quick approvals and flexible EMI options are other attractive advantages of such loans.
Though, interest rates are quite higher due to no cibil score check policy. Income proof is a major document required for qualifying for no credit check loans.
2. Income driven hardship loans
People with low income or poor credit situations can also seek emergency loans through income-driven hardship plans. This plan is especially focussed on individuals with low salaries owing higher debt amounts.
Medical emergencies or catastrophic damages situations get easily approved for these loans. Total loan amount is divided into affordable monthly installments for convenience.
3. Non-profit lenders
Investment is a key new start-ups and entrepreneurs starting out in the corporate world. Emergency loans are provided to such small or medium – scale enterprises by non-profit organizations, banks and private lenders. Such loans charge negligible interest rates and are lended with zero-profit intent for the whole and sole reason of support and upliftment.
4. Alternatives
In case of denial of loan application from above listed options, various other effective emergency loan providers could be located with careful research and expertise.
- Seeking informal loan from family member/Relative.
- Spouse loan is a good alternative.
- 0% APR loans.
- Payday loans.
- Personal or home equity loans.
Prepare for the next emergency in advance. You never know when one such crisis knocks at your doorstep. “It won't happen with me” attitude is bizarre. Improve your credit history, start saving up for the future and fully anticipate your financial situation carefully during such bad times.
