On average, homeowner households earn 95% more than renting households per
year. With 26% of a rental households disposable income being spent on renting,
in comparison to 15% of homeowners on their houses (not including maintenance),
it is unsurprising that people who rent find it harder to manage and turn to bad
credit personal loans for help.
It?s easy to fall into the rent trap. As monthly rents take over ? of their
income, debts for renters can easily pile up. It is very difficult to make any
savings towards a deposit for a home and very easy to get bad credit if you skip
payments on things like credit cards to try and make ends meet. Fortunately,
renters with bad credit can still apply for a bad credit personal loan.
A bad credit personal loan is an unsecured loan. This means that unlike a
home equity loan you do not have to pledge a valuable item such as a home or a
car to guarantee repayment. If you rent this makes perfect sense as you do not
have a home to pledge anyway!
A really useful thing to know is that a bad credit personal loan can be used
for just about everything including:
? Buying Christmas presents
? Furnishing a rented home
? Paying off credit card bills
? A new car
Most companies that offer bad credit personal loans are not interested in
what the money will be used for, they are merely interested in whether the
person taking out the loan will be able to make the repayments or not. If you
have bad credit then you will need to seek appropriate lenders who offer a
personal loan for people with bad credit, but there are an abundance of
specialist lenders available.
The main advantage to using such a loan is that unlike a credit card, the
credit is non-revolving. This means that the interest rate and the term of the
bad credit personal loan are fixed at the outset. The monthly repayments are
always the same and this makes it far easier to allow for in a monthly
budget.
As these loans are unsecured and for bad creditors, they do carry a higher
interest rate than a home equity loan, but if you do not have a home then this
narrows your choices substantially.
