How to Get High Risk Personal Loans

Trying to get high risk personal 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.

Difficulty: Challenging

Instructions

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   High risk personal loans can become more possible if you write a letter explaining why you want the loan, how your income enables you to pay it back and how your credit and work record prove your responsibility. Including such a letter with a loan application is helpful as it gives the lender a sense of who you are beyond a simple credit report or paycheck stub.

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   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.

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   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.

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   Visit the websites of large national lenders such as AGFinance.com (American General,) Citibank.com or WellsFargo.com if you are not having success getting high risk personal loans in your own community.

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   Offer up some form of collateral, such as home equity or stocks, or provide a co-signer if you are having difficulty getting high risk personal loans. One or both of these elements can open up lending opportunities that might be otherwise impossible, especially when it comes to getting large loans.

Tips & Warnings

• Remember that failure to pay high risk personal loans can severely damage your credit and even end up getting your wages garnished to repay the debt.
• Consider reading some of the books in the Resources section about debt management and credit.
• 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 high risk personal loans become a reality.

Resources

• Debt Cures
• The Total Money Makeover: A Proven Plan for Financial Fitness
• BestCredit: How to Win the Credit Game, 2nd Edition
• Suze Orman's 2009 Action Plan
• The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich

[Mitestarossa]

on 4/11/2009 Excellent advice on high risk loans.