Cash Loan For Bad Credits Philippines

What is Credit Score? 

A credit score is a method used by credit companies in measuring and verifying the creditworthiness of a borrower. A certain range of numbers has been used to classify an individual’s credit standing ranging from 300 to 850. 

Below are numerical ratings used which signify the creditworthiness of a borrower.

• Excellent: 800 to 850
• Very Good: 740 to 799
• Good: 670 to 739
• Fair: 580 to 669
• Poor/Bad: 300 to 579

A person with a bad credit history means that he or she has a credit score between 300 to 579 and anyone with this credit rating will not be able to be granted a loan from different financial institutions that require a credit check. 

What Affects the Credit Score?

There are criteria that credit companies follow to ascertain the creditworthiness of a borrower and they are the following: 

• The payment history will be checked if the person has been able to pay all loans or credit acquired in a timely manner. 
• The amount borrowed will also be checked such as how much of a person’s credit line has been used. For example, if a person has a credit card and exceeds the limit, that will go against the credit score of a person. 
• When a person has had a long history of obtaining credit and has been paying on time, this will tremendously improve the credit score of a person. The length of credit history is also important in the determination. 
• A person with a lot of credit applications will not be advantageous as this will show a red flag and credit companies might assume that a person is financially unstable and has difficulty paying debts on time. 

In the Philippines, there are different companies that provide a credit scoring system. They are the following:

• FinScore
• Credit Information Corporation
• CRIF 

Credit Companies that Offer Cash Loans for Bad Credits

Despite the fact that many financial institutions require borrowers to have a good credit score, there are still other lenders that offer cash loans to people who have bad credit histories. 

Listed below are the common requirements in applying for a cash loan: 

• The borrower must at least be 18 years old but not more than 65 years old at the loan’s maturity
• Submit 1 government-issued ID
• Submit proof of income
• Provide a bank account number
• The borrower must have an active mobile number

Following are a few lenders in the Philippines that offer cash loans to borrowers even with a bad credit history:

Tala PH

• Loan Amount: Up to Php15,000
• Loan Interest: as low as 9.5%
• Loan Terms: 15 – 61 days

CashMart ph

• Loan Amount: Php5,000 to Php50,000
• Loan Interest: 0.8%  to 3.5%
• Approval Period: 1 day

MLhuillier Pawnshop

• Loan Amount: depends on the appraisal value of the collateral
• Interest Rate: 13% for a loan term of 3 months
• Loan Term: 3 months, extendable

Conclusion

Obtaining financing with a bad credit history is a challenge especially if one approaches banks and other traditional financial institutions. It is always wise for a person to ensure that any credit or loan payments that a person has must be paid on time. If not, the consequences are not ideal, especially in times when a person has a financial emergency. Nevertheless, there are still other financial institutions in the country that offer cash loans even with a bad credit history, although the interest rates are higher, the terms are shorter and in some cases, collateral is needed.