Being married can definitely have its perks - you not only have a companion and a better tax bracket to file your income taxes in each year, but you also qualify for larger loan amounts, regardless of your bad credit. Many married couples are finding that filing a joint application for a bad credit unsecured loan gives them leverage with lenders who might ordinarily turn them down if they applied separately. Why?
|Click on our Advertisement
Lenders Love Borrowers With Two Incomes
There are many factors that a lender will take into consideration when you need to borrow money, and borrowing money without collateral, as is the case with an unsecured loan, has special implications. Lenders need to know before they open their wallets to grant money in the form of an unsecured loan that the borrower has sufficient income to repay them. This holds true for borrowers with amazingly clean credit reports as well as those borrowers who have experienced financial difficulties and have less than ideal scores; everyone who borrows money must prove to potential lenders that they can pay it back.
For many lenders, the ability that the borrower has to repay them is more important than a few derogatory comments that the credit report of the borrower might hold. Therefore, a married couple with two incomes has a greater chance of getting the unsecured loan that they need than a single person because there is more money coming into the household to repay the lender because the lender will use the combined income of the couple in making their determination of creditworthiness as well as unsecured loan limits.
Determining Your Interest Rate
The lender of your unsecured loan will also look at credit performance in the past for both you and your spouse. The amount of interest that you will pay on your unsecured loan will be directly proportionate to your FICO credit score. Remember, however, that paying a bit more interest now will garner you better rates on future loan products that you might wish to obtain, and that your unsecured loan will start to add valuable points to your credit score when you begin repayment.
Additionally, like many borrowers, you may find that after just a year or so of solid payment history with your new lender you will be able to refinance your unsecured loan to a lower interest rate to reflect your newly developed responsible borrowing behavior.
Bigger And Better Future Loans
Developing responsible borrowing habits is simple. Be certain to make your payments on time every month and to pay as agreed; never make partial payments unless you have an extreme emergency and the lender has agreed for you to do so. Even one late payment can have severely negative consequences on your credit score and your ability to take out future loans, so avoid paying late at all costs. A good rule of thumb is to pay a week early, and to pay online if the lender offers that option.
One of the best sources of unsecured loans is the Internet. Online lenders offer greater rates of approval for borrowers from all credit situations and histories.