It has been several years since Bank of America stopped offering personal loans even for people with good credit score. So, anyone looking to a big bank like BofA must know that it is futile to try and get financial assistance especially when he or she is struggling with credit.
So, Bank of America is not ideal for a bad credit personal loan. Is there any other option to try?
Yes, there are options but that depend on several factors, the most important being your credit score. Obviously, a person seeking a bad credit personal loan will definitely have trouble with his or her credit history.
Fortunately, there are companies that have come up just to cater to such people. They might need you to be sound in one or more areas to be able to apply for financial assistance. For example, some might look into your income pattern while others try to bring together a set of stringent rules to help them make for the associated risks and dangers of an unsecured loan.
While credit unions have always been there to help members with their sundry financing needs, there have been a big growth in the number of peer-to-peer lending institutions that do not give much consideration to your credit rating. Of late, we see a number of online lenders as well that promise swift processing and easy application.
Alternative Lenders for Good/Bad Credit Personal Loan
To cut short the long debate, we are now presenting you with a selection of some well-known bad credit personal loan providers in 2020.
A Chicago based company, Avant is known for extremely low credit score, which can be as low as 580. The downside is that it doesn’t allow co-signing. Also, the APR can be of the higher side and the maximum amount you can borrow can be $35,000. Borrowers seeking refinancing option or looking for a flexible payment option may find Avant loans useful.
A network of lenders, Personalloans.com can be useful for people who have extremely low credit score and need only a little amount to borrow. The maximum loan amount is set at $35,000 and a person residing anywhere in the country can apply for a poor credit personal loan. The loan can be had for a maximum of 6 years.
Headquartered in Cincinnati, Ohio, First Financial is a full-fledged bank offering services at regional level. Among the range of its services include personal financing, which can offer a personal loan of up to $15,000 for a term period of up to 5 years. The application process is quite easy, but you need to have a fair credit score and decent income to qualify for the loan.
You need at least a score of 600 to qualify for a loan at LendingClub, which is a major peer-to-peer lending company based in San Francisco. A borrower also needs a minimum credit history of three years and a DTI ratio not exceeding 40%. However, you can apply jointly to avail more flexible application criteria.
A rival company to LendingClub, Prosper is also a major peer-to-peer lending company and has headquarters based in San Francisco. It may be quite difficult to apply here for a person with very low credit score. However, you can apply here without ever thinking about a dent in your credit health as it pulls a soft credit check. Moreover, you can still be eligible to apply if your monthly income is anything above $8,000.
What are the eligibility criteria and documents required to apply for personal loan?
You will need to provide specific details and documents to verify you trustworthiness, credit history and all financial background for loan application.
You will have to submit following:
- Copy of a prior two year W-2s Form
- 2 current consecutive pay stubs
- Last two month bank statements of all accounts
- Self attested tax return copy
- Self-employed person can submit his quarterly or yearly profit/loss details
- If you are borrower of mortgage, line of credit or home equity loan, submit monthly statement.
You can easily download loan Application Requirements Checklist.
What types of loan options available at Bank of America?
Bank always helped to borrowers as personal finance at emergency time. It provides an array of financial solutions in all over country which is described below:
Whether you are looking to buy a brand new or a used vehicle, BofA offers auto loans that come with a number of benefits. You can easily finance your car with a low rate auto loan having flexible repayment terms and conditions. Borrowers should ensure fixed rate before buying a car. Currently, bank describes 2.39% APT+ on new car, 2.64% APT+ on used car and 2.89% APT+ on refinance. When you obtain an auto loan from the bank, you enjoy the following benefits:
- Lower interest rates
- A 0.5% rate discount on auto purchase or refinance loan for BofA personal checking customers
- Fast access to funds (in as little as 24 hours)
- Online payment tools and auto loan calculators
- Dealer network that can help streamline the purchasing process.
Home Equity Line of Credit
Your home opens the door to a number of possibilities. Use the equity of your existing home to secure a home equity line of credit from BOA and get instant access to funds whenever you need it. Use your credit line to complete a home renovation project, plan a vacation, make a major purchase, consolidate debt, or pay your child’s tuition. Basic features of this line of credit include:
- 875% variable APR
- Minimum line amount of $25,000
- Maximum line amount of $500,000 (for primary residence) and $100,000 (for second/vacation home)
- A 10-year draw period followed by a 20-year repayment period.
You can call customer service representative at 1.800.763.2053 for Home Equity Line of Credit.
Home Equity Loan
This is a fixed rate loan that you can obtain by providing your home’s equity as collateral. It allows you to get the entire loan amount all at once. As you borrow a one-time lump sum, this loan is convenient for large expenses and debt consolidation. Some basic features of home equity loan are:
- You have to pay fixed rate, monthly principal and interest
- Fixed loan term ranging from 3 to 25 years
- Minimum line amount of $25,000
- Maximum line amount of $500,000 (for primary residence) and $100,000 (for second/vacation home).
What is the best deal regarding personal finance at Bank of America?
Personal loans can be classified into two types: secured and unsecured. To obtain a secured loan, you need to provide a collateral such as your home, car, savings account, or certificate of deposits. Providing collateral allows you to get lower interest rates and better loan terms.
Unlike secured loans, you are not required to provide any collateral to get unsecured nature loans. Approval for the loan mostly depends on your credit score and income status. The banks generally charge higher interest rates for unsecured loans. You can follow some simple steps to get the best deals when applying for personal loans:
- Shop around, check customer review, and compare rates and terms of various lenders
- Check your current credit score and fix any discrepancies before making your loan application
- Understand your repayments terms and look out for hidden fees and charges
- Provide collateral if possible to get lower rate and better repayment terms
- Make your repayment on time and maintain your budget.
How to avoid bad credit loan scams?
Keep your eyes and ears open when searching for a lender. Instances of scams and frauds are not unreal. You must avoid the dangers and keep your financial status safe from the evil activities of unscrupulous lenders.
The following are some tips.
- Use all online and offline media to search lenders in your area and select only a few that matches your financing needs and application eligibility.
- Collect as much information as you can for all selected lenders and sort your list again to give top priorities to those that look more authentic.
- Starting from the top of your list, visit the physical location of the company, meet its authorized person and gather all required information.
- Pay special attention to APR, interest rates, closing fees, hidden charges, prepayment penalty and any other relevant information.
- It is always better to interview an existing client of the company and base your judgement according to their reviews.