Sometimes people take loans and later on find themselves in a precarious situation when the time comes to meet the loan obligations. By not repaying in accordance with the terms of loan agreement, some people earn the dubious distinction of being bad credit holders. Very often, bad credit arises in the form of arrears, default in repayment, missed installments, bankruptcy, county court judgments, etc. But, do not worry, as you can still avail installment loans for bad credit.
You can use bad credit loans for various purposes. So, there are different types of bad credit loans to help you in different situations. Broadly speaking, bad credit loans can either be secured or unsecured. Which loan you should take out depends on many factors, like your financial requirements, individual circumstances and your preferences. If you prefer not to give collateral to the lender when taking out a loan, then obviously you will have to apply for unsecured bad credit loans.
Unsecured bad credit loans are hard to get because lenders perceive a substantial risk in these types of loans. Even if you get unsecured bad credit loans, the interest rate will be very high. On the other hand, secured bad credit loans are relatively easy to avail. The lender gets a security and, therefore, sanctions you a bad credit loans. Homeowners normally like to take advantage of their homeowner status by negotiating a competitive deal in the case of secured bad credit loan.