Bad credit history or poor credit rating is a social taboo which may affect an individual in times of financial crisis. Many conventional lenders would not like to risk their money and give loan to such people. However, there are financial organisations which do not consider bad credit rating as a risk for their money and provide loans to such people. Very poor credit rating loans are designed to help people with bad credit history in urgent times of financial need.

Generally, a borrower can avail two type of loan — secured and unsecured. With secured bad credit loans, a borrower has to pledge collateral either in the form of his house or car or jewellery or bank papers. This form of loan has low rate of interest with high repayment tenure and the loan amount is also more. This type of loan is most suitable to pay off all the earlier debts and concentrate on repaying only one debt. Loan amount is around $25,000 - $40,000, repayment tenure ranging from 10 - 20 years and interest rate is around 10% APR. However, with unsecured very poor credit loans, the rate of interest is very high which is around 30% APR, loan amount can be anything between $2,000 and $5,000 and repayment tenure not more than 5 years. But lenders do not ask for any collateral with this form of loan.

A borrower may avail very poor credit loan for various purposes like medical expenses, pending bills, house or car repair expenses, credit card bills, etc. or to pay off earlier debts to improve the credit rating. Lenders do not require credit check as the loan amount is approved on the borrower’s repayment ability, value of collateral and pay cheque. One has to be at least 18 years of age to be eligible for this loan apart from being a US citizen. He should also have a valid bank account.