Strategies For Getting Second Chance Loans

If you've had a history of serious credit problems such as late credit card payments or bankruptcy, then you are considered a "high risk" when it comes to getting any type of new accounts. Keeping a positive attitude and maintaining patience and flexibility are essential emotional assets when it comes to pursuing credit-challenged or "sub-prime" loans in this economic climate.

First, visit local banks, credit unions and other lenders such as finance companies first to apply for high risk personal loans. Local lenders are more likely to extend riskier loans because if the payments are not made, they can more quickly take court action such as suing you for the bad debt.

Trying to get high risk personal loans or "second chance" loans works best when there is low usage of existing accounts. For example, if you have $30,000 worth of credit card limits, you should strive to use only 20 to 50 percent of this credit, or $6,000 to $15,000. You must also ensure you have no recent late payments or collections accounts, such as medical bills, when applying for high risk personal loans with any lender.

Ask a friend or boss to be a character reference with the bank or credit union when requesting high risk personal loans. Do not use this method if you have any doubt about your ability to repay the loan, because this can damage your personal relationships as well as affect the person's reputation within the banking community.

Do not give up if you really need a loan but cannot get one right away. Adding elements such as collateral and/or a co-signer in most cases can make requests for loans become a reality even if you have a poor.

Remember that failure to repay second chance banking loans can severely damage your credit score and even end up getting your wages garnished to repay the debt.

Never be attacking when having any kind of discussion about your credit score. Use words such as "I" rather than "you" and focus on mutually solving any problems at hand. The burden of proof is on you to show that despite your past credit history you are a good financial risk. You also must have an inner sense of integrity and self-esteem to successfully pursue sub-prime loans and credit card accounts. If you have unusually high emotional stress relating to your finances, consider talking to a credit counselor, life coach, therapist, minister, rabbi or a trusted friend or family members.

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