If you need cash fast and own an asset you can use as collateral, secured loans for poor credit can be a great option. These loans often come with less strict requirements and same-day funding. But with so options available, you may be wondering which is right for your needs. Let's dive deeper into four ways to compare secured loans for poor credit so you can find one that works for your financial situation:
There are many types of secured loans for poor credit that require different assets as collateral, including:
- Title loans: Title loans require you to use your car title as collateral. With these loans, you can get a loan amount worth a percentage of your vehicle's value and can keep driving your car as you repay the loan.
- Auto loans: Auto loans are funds you can receive to buy a car. With this type of secured loan, the car you buy is the collateral.
- Pawn shop loans: With a pawn shop loan, you'll provide an item of value you own as collateral to a pawn shop, such as jewelry or artwork. Then, the pawn shop will give you cash and hold onto your item until you repay the loan.
When looking for secured loans for poor credit, make sure to compare the interest rates. Some lenders will offer the same type of loan at different interest rates, and the lower the interest, the less you'll have to pay over the life of the loan. Choose a loan with interest rates that work for your budget.
Secured loans for poor credit come with different loan amounts. For instance, with a title loan, you can often receive 25 to 50% of your car's value. So, consider how much money you need when comparing secured loans to find the right option.
Before choosing a secured loan for poor credit, make sure the loan has manageable monthly payments. If you can't repay the loan, the lender can repossess your collateral to recoup the loss. By choosing an affordable option, you'll be able to stay within your budget and avoid losing your collateral.
The bottom line
There are many types of secured loans for poor credit at your disposal. Compare the types of collateral required, interest rates, loan amounts, and monthly payments to choose a loan that meets your needs and budget. By doing your research and choosing a good loan option, you'll be well on your way to getting the funds you need fast.
Notice: Information provided in this article is for information purposes only. Consult your financial advisor about your financial circumstances.
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