Bad Credit Holiday Loans – Tickets For Worry Free Holidays
The first step towards getting a loan with bad credit is to gather all of your information that is going to be needed for your application for a loan. Many people applying for bad credit holiday loans to lenders that will lend money to clients whose credit ratings are less than stellar leave out a lot of information. The holiday period is particularly stressful for many families and individuals who would like to buy gifts for the family, but do not have the ready cash. They will sometimes apply for holiday loans with bad credit so they can have a worry free holiday and make the family happy. After the holidays are over they will then think about how they will repay the loan. Consumers should always have a plan about how they will repay a loan and make sure that they will have the funds, otherwise their credit rating may get worse than it already is.
Client Application Review for Holiday Loans
Lenders will review every client’s application and do whatever they can to lend them the money they need for the holiday period. They really understand how important it is to have something for the family or that special someone during the holiday period. At the same time they will also want clients to provide the appropriate information to help them process and approve the loan. They need to make sure that the borrower will not default on the loan or will not miss any monthly payments, otherwise they will lose money for their clients.
Clients should be prepared to provide a copy of their pay stub to substantiate their income. The pay stub shows who your employer is and how much money you are actually taking home after all deductions have been subtracted. Many consumers will have automatic deductions for savings to retirement plans, deductions for alimony payments and even loans to other lenders come right off their paycheck. Your pay stub will show all of this and more which the lender can use to verify your application.
They may also want to see a copy of your last month’s statement from your bank account. There are a couple of reasons for this and every lender is different in their requirements and the reasons they ask for these things. For example some lenders want to see the bank statement to review and confirm that there are no checks that were passed with insufficient funds. This is a red flag for many lenders, especially with clients who have bad credit. They are trying to make sure that you have the cash flow to pay your debts and that you are managing your debt to avoid overdrafts on your checking account.
Bank Accounts and Bad Credit Holiday Loans
Many lenders also will only transfer money to a bank account and also retrieve payments from a bank account. This process provides them with an accurate record of the money transfers between their accounts and the client’s accounts. In addition, with the statement, they can accurately enter the information into their systems to activate the money transfers for the loans and the payments. Bank account information consists of a bank number, a branch number and a bank account number. If this information is entered incorrectly, not only will you not have your money, the funds will end up in someone else’s account!
This could be a major problem for everyone. With an incorrect account number, the lender must get the money back which is a problem by itself. There are fees for mistakes like this and no one wants to pay added fees. In addition the borrower does not receive their loan when they really need it to deal with whatever issue they are dealing with.
Secured Bad Credit Holiday Loans
Some lenders will request security for their loans and some clients may also be interested in providing security for the loan. The client may want to do this because they know they can negotiate better terms and interest rates for this type of loan when they provide security. The lender will also request security in these situations when a client’s credit is really bad and they are concerned about repayment. This situation provides the lender with a better probability that the holiday loan will be repaid at the agreed time.
A car loan is the most common type of loan that uses a car as security for the loan. Equity in homes can also be used as security and mortgage rates can be very low for secured mortgages. While technically not a holiday loan, your holiday is going to cost less since you are enjoying a lower interest rate.
Plan for your Holiday Loan Repayment
After the holidays we all get back to normal and it is time to repay our credit cards and our bad credit holiday loans. We cannot ignore them and we know that after the holidays are over we need to have the money to pay off the loan or at least meet the payment requirements of the loan. Some people will work overtime during the holidays so that they have the cash to repay the loan. Whatever your loan amount is, always review how you will repay the loan once the holidays are over.
Many people also use credit cards to pay for all of their holiday expenses. This includes paying for presents for the family as well as for trips during the holidays as well. Unfortunately if you cannot repay the balance on the credit card by the due date, the credit card company will charge a really high interest rate on the unpaid balance which makes your holiday much more expensive that perhaps what was planned.
Consumers will apply for holiday loans to help them consolidate their debts on credit cards so they will pay a much lower interest rate. They can reduce their monthly payments and they can pay a lot less interest as well by taking this approach. Moving from an interest rate of 19% or more to an interest rate of less than 10% can make a huge difference in the amount of money that you pay in total interest.
In summary, make sure that you have all of the information needed to support your loan application, make sure you have a plan for repayment of your loan and if you use a credit card to pay for your holiday, apply for a consolidation loan to manage and decrease the amount of interest that you will pay for your holiday loan.