A bad credit score usually sits below 560 and can affect your ability to get a loan. Although your options may be more limited, you still have options.
Compare Nova Scotia bad credit loans
Can I get bad credit personal loans in Nova Scotia?
Yes, there are many online and alternative lenders in Nova Scotia that are willing to work with you, because credit score is just one of several factors they look at. Other factors can include your income, employment history and existing debts.
Having an asset you can put up as collateral or a cosigner to guarantee your payments will also increase your chances of approval.
How do bad credit loans work?
Bad credit loans work just like normal personal loans except they come with higher interest rates. These can help pay for unexpected or emergency expenses, but you can also use them to consolidate debt, finance large purchases and cover bill payments.
Lenders in Nova Scotia will typically look at your credit score and your debt-to-income ratio before they approve you for a bad credit loan. You’ll likely be able to qualify if you’re permanently employed or have a credit score closer to 560 (which is considered the fair credit mark). If you qualify, you’ll need to pay your loan back in regular installments over a set period of time. It’s important to make sure you make all payments by the required due date to avoid defaulting on your loan as this will cause your credit score to go down further.
Types of bad credit personal loans
You can apply for several different types of bad credit personal loans in Nova Scotia.
- Secured loans. Secured loans require you to secure your loan against an asset (like your home or vehicle), and you risk losing it if you can’t make your repayments on time.
- Unsecured loans. These loans will let you borrow money without securing your payments against some form of collateral.
- Guarantor loans. You’ll need to arrange a cosigner to cover your loan payments if you default.
- Same day funding
- Quick online application
- Pay off loan anytime
FlexMoney Personal Loan
Apply online in less than 10 minutes. If approved, receive funds in as little as 24 hours. Pay off your loan at any time.
- APR: 18.90% - 46.93%
- Loan amount: $500 - $15,000
- Loan term: 6 - 60 months
- Fees: No application, origination or prepayment fees
- Min. credit score: 500
How do I apply for a bad credit loan?
If you’re applying for a bad credit loan in Nova Scotia, you’ll need to follow the steps below:
- Fill out an application. You’ll need to apply online, in-person or over the phone and provide personal information such as your address and contact info.
- Verify your identity. Lenders will ask you to verify your identity by providing a government-issued piece of ID like your driver’s licence number or passport.
- Show proof of income. You may be asked for proof of income in the form of pay stubs, tax returns or bank statements.
What should I keep in mind before applying?
Before you apply for a bad credit loan, you should consider the following to make sure you get the best deal possible:
- Look for low interest rates. Compare lenders to find the lowest rates and don’t be afraid to ask for better terms.
- Aim for a shorter term. Since your interest rates will be higher, it makes sense to negotiate a shorter term if your budget allows for it.
- Budget for repayments. Look for a loan with flexible terms and find out what will happen if you default on your loan, especially if it’s secured with collateral.
- Make sure you qualify. Every credit check on your account will bring your credit score down even further so only apply to loans you know you’ll qualify for.
- Read the fine print. Some lenders will bury hidden fees and charges in your contract. Make sure to read the fine print thoroughly.
How can I improve my credit?
- Make payments on time. Your payment history accounts for roughly 35% of your credit score so it’s important to be consistent.
- Limit your spending. Avoid spending money on your credit cards that you can’t pay back by the due date.
- Mix up your credit types. Make on-time payments on a variety of debts, including credit cards, mortgages, loans and leases.
- Negotiate new terms for your debt. Ask your lender about extending your contract or adjusting repayment amounts if you’re having trouble meeting your current terms.
- Consolidate your debts. This can make it easier to make payments on time, since you’ll only need to manage one payment on a larger debt.
Credit builder loans
Another option to consider for building your credit is a credit builder loan. These loans are designed to help you build your credit score by reporting all of your on-time payments to the credit bureaus. They’re usually targeted towards people with bad credit or no credit history and are typically offered by smaller financial institutions such as credit unions and private lenders.
When you sign up for a credit builder loan, you’ll agree to make payment towards your loan amount before you get the money you borrow deposited into your bank account. This is to give your lender security that they’ll have money to cover your loan if you default but it also allows you to get access to secured credit even if you don’t have an asset to put up against a secured loan.
Check out credit builder loans in Nova Scotia
Other options available for people struggling with bad credit
- Government subsidies. You may be able to qualify for provincial funding through income assistance, affordable housing or disability support programs.
- Credit counselling services. Services like Service Nova Scotia’s Debt Assistance Program may be able to help you consolidate your debts and figure out a budget.
- Debt relief services. If you’re finding yourself in a vicious cycle of debt, a debt relief company is an option.
- Borrowing from friends or family. If you’re struggling with bad credit, you might like to ask friends or family for a more flexible, interest-free loan.
- Getting a cosigner. You can usually qualify for lower interest rates if someone with good credit guarantees your loan.
If you have bad credit you may still be able to qualify for a loan with higher interest rates. Find out if this type of loan is the right fit for you, learn what to watch out for and compare lenders in Nova Scotia to find the right loan for you.
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