unsecured personal LoansThere was once a time when it was impossible to find unsecured personal loans for people with bad credit.  However, with the economic conditions of the past few years and the increasing rate of unemployment, many individuals who once enjoyed having good credit have fallen into debt or have bad credit.  Many lenders have now adjusted their lending practices and qualification policies so that they do not only focus on credit history and FICO score.  Many lenders will now provide unsecured personal loans for people with bad credit based on these new qualification methods.

Loans for Bad Credit
Although once unheard of, there is such a thing as loans for people with bad credit and it does not require that you borrow against your assets or your property.   Bad credit lenders qualify individuals based on factors such as your current employment and history of income rather than your FICO score.  These lenders provide you with a bad credit loans that is also referred to as Cash advance loans or Payday loans.  These loans have a short life usually from a couple of weeks to a short few months and must be paid back on the agreed term.

Advantage of these Loans
The advantages of these bad credit loans are: hassle free approval process, do not require faxing documents, and the funds can be available in your bank account in span of 60 minutes to 24 hours.   Apart from easy and fast access to the funds you need, the real advantage with unsecured personal loans for people with bad credit is that you do not need to put your home or property in line and endanger it.  You simply get the funds without having to put down any assets.

Specific Usage of Bad Credit Loans
There is a specific use for these loans and that is to only pay urgent bills.  You should never take out these loans for any other purpose other than emergency situations.  Emergency situations constitute paying for medical bills, car repair (if used to commute to work), unpaid bills for utility that is in danger of being cut or any other urgent bills.  The reason you should not take out these loans for other matters is that payday loans carry a high interest rate and should be repaid in full on the agreed upon term of two weeks or whatever the term is.  In urgent situations, it is the availability of the funds that is more important than the interest rate charged on the loan.

Look for Other Alternatives
Before searching for a lender that provides loans for people with bad credit, you should look for other alternatives. Although payday loans can be a great help to you if used properly and for the right purpose, there may be safer sources for borrowing funds. The main advantage of these alternative sources is that you are not required to pay the high interest rates that are common with most bad credit loans. Although it may be common sense, many don’t realize that friends and family are a great source. Your family or your longtime friends, if able to help, will not judge you based on your FICO score but based on years of trust and personal knowledge of your character.

Your employer is another source where you can tap into. You may be able to ask your employer to give you an early paycheck or a cash advance. Again in this case your employer will probably not ask for your credit score to qualify you for the advance. Your employer in all likelihood will look at years of service and your work ethics. Thus, if you have a good working relationship with your employer, there is a good chance that your boss will extend you a cash advance. Your employer knows that your work and service will cover the loan in a short time. Only if you are unable to secure a loan from the above sources, you should look for bad credit lenders or search online for loans for people with bad credit. Failing to look at these alternatives, could cost you a great deal of money in terms of interest payments.

Warning about Payday Loans
Do not take out these bad credit loans unless you are certain that you are able to repay the loan and the interest charged upon it on the agreed time.  Falling behind these payments will get you into serious financial trouble as they have very high interest rates and penalties for missing payments.   It is absolutely critical that you calculate your finances and your ability to repay these funds accurately.  Seek the advice of a financial expert if you are not certain that you can repay the loans on its due date.

If used properly these payday loans can help you with paying those urgent bills and you can repay the funds in full the next time you receive your paycheck.  Repaying these loans can also help you build your credit.  However, it is recommended that you first seek other alternatives for borrowing before looking at payday loans such borrowing from family, friends or your employer.  These alternative sources will not charge the high interest rates that are the mark of payday loans.  If you fail to attain loans from these sources, then you can use payday loans as your last alternatives but as mentioned earlier you must be certain that you can repay it back in full on the due date.