How Credit Score Impacts Personal Loans

If you live in the United States, then your credit score matters. Your credit score can determine a lot of things, including your housing options, insurance rates, and even your personal loan possibilities. A good credit score is any score at 690 or above, while a bad credit score is anything below 630. Anything in between is considered fair or average credit. How will your credit score impact your personal loan choices? Continue reading below to learn more.

Different Lenders Have Different Requirements

First of all, if you don't have good credit, don't despair. Having bad credit doesn't necessarily mean that you can't get a personal loan. It does, however, mean that you have fewer choices. For example, don't waste your time at a large, traditional bank. These banks probably won't approve your application. Instead, try community banks, credit unions, and online banks. These entities are far more likely to approve loan-seekers with fair or bad credit.

Don't give up after your first application. Loan requirements aren't universal, so you may still find a personal loan option that will work for you.

Credit Score Can Impact Your Interest Rates

Next, understand that your credit score can impact your interest rates. If you have poor credit, you'll likely pay more for your loan than someone who has excellent credit.

However, this fact doesn't mean that you don't have options. Again, don't forget to shop around. In this case, a credit union may be your best bet for finding decent interest rates. Credit unions are nonprofit organizations, which means that their primary goal is not to make money off of you. As a result, you may find better interest rates at a credit union than you would find at a traditional bank.

Other Factors Matter

While your credit score is an important factor when it comes to personal loans, it's not the only factor, so don't get discouraged if your credit is less than amazing. Your potential lenders will also look at your current debts and income. Other factors can include your previous loan history, employment history, and collateral.

Compare Your Options Now

No matter your credit score, you deserve to see your best possible options. Bundlefi is here to help you see those options all in the same place. Check out Bundlefi now to see your loan choices from online banks, community banks, and credit unions. These choices generally offer the best rates and customer service.