It is easier for people to get funds thanks to the many financial institutions that provide loan facilities. However, not everyone who applies for a loan can be approved.

One of the main reasons for the rejection is because the prospective debtor has a low credit score or a very bad credit score. Is there a possibility of bad credit loans guaranteed approval?

Credit score is a rating on your credit performance at financial institutions. Having a good credit score is important, because your credit score will be used as a reference by financial institutions to determine whether a loan application is worthy of approval or rejection.

For information, the nominal amount of the loan, term loan, and loan interest are also determined from the credit score. If your credit score is good, it will be easier to get a loan, whereas if your credit score is bad, it will be difficult to get a loan.

Then what if your loan application is rejected by the bank because you have a bad credit score? You can still build your credit score in other ways. One of them is taking advantage of no credit check loans from direct lenders who provide guaranteed instant approval.

Before applying for a loan from direct lenders, it is important for you to improve your credit score so that your loan can be approved immediately.

How to get bad credit loans guaranteed approval? Read more below:

1. Use only one credit card

Usually, many people forget to pay credit card bills because they have more than 1 credit card. It will burden your finances and once you are late paying for a few times then your credit score will get worse.

Especially if your loan status is already bad, it's better to pay off your credit card debt immediately and then close the credit card that you don't use. Try to use 1 credit card first while practicing your discipline.

That way, you will become trained to be non-consumptive. Choose a credit card that has the highest interest as a priority for repayment.

2. Keep the debt ratio low

Another thing that makes your credit score low is the amount of your debt that may have exceeded the limit of your ability. Ideally, your maximum installment amount is 30% of your monthly income.

How to determine good installments? If you have a monthly income of $1,000 and a total installment of $500 then your debt ratio is more than 30%.

Having installments of more than 30% of your income will only worsen your credit score, because direct lenders will perceive you as a potential debtor at risk. You have to focus on paying off the debts you have before taking on new debt.

Thus, direct lenders will judge you as a responsible and trustworthy prospective debtor.

3. Pay installments on time

Commitment to paying installments on time is the key to improving credit scores. Late repayment of a loan will have a negative impact on your credit score.

In order not to forget to pay your installments on time, you can use the automatic payment feature or use a calendar reminder.

4. Can't be confirmed and contacted

Direct lenders will verify by contacting the borrower, the goal is to ensure that the loan application written on the application form is actually done by you.

This verification also aims to avoid fraud, where identity data is lost and then misused by other people to apply for loans.

5. Different bank account data

Bank account data must be included in the application form used to disburse loans and avoid fraud.

Fraud usually occurs if the disbursement is made to a different account name from the one applying for the loan. Therefore, the similarity of your data and bank account becomes important.

6. Emergency contact verification failed

Direct lenders will ask you to provide the phone number of a relative or close friend that must be filled in on the submission form. This data will be verified by direct lenders and if it cannot be contacted or can be contacted but does not match, the loan application will be rejected.

7. Address does not match

Advances in technology allow direct lenders to know the location or area where you live. The location of residence is important to ensure the existence of the borrower and honesty in filling out loan application data. Borrowers who are not in the area listed as a residential address, the loan application will be rejected.

Bad Credit Score Can Return To Normal

Actually you will have no trouble getting bad credit loans guaranteed approval from direct lenders as long as you follow the steps to recover your bad credit score described above.

It takes good intentions and discipline in paying off debt because it is your responsibility as a borrower and will make it easier for you to get a loan with a larger nominal in the future from direct lenders.