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Few lenders are reluctant to provide loans that are needed to repay some of arrears, there are also those which are more than willing to help, offering loans to rebuild and acquire an individual’s good financial standing once again.

The most common forms of loan to fix bad credit are:

1. Credit cards. One way to establish a good financial standing once again is to pay through credit cards. Small purchases while paying off outstanding loans must be done and the borrower should ensure not to miss monthly payments.

2. Loan for home owners who have negative credit history. This repair loan can consolidate bad credit such as mortgage arrears. Usually, a loan adviser will make an assessment and he/she will advise about the quotation and details of the options about financial consolidation.

3. Refinancing mortgages lets anyone borrow at a low interest rate. In refinancing, an individual will use a house or property as collateral for a loan. The three major agencies in refinancing mortgages are Equifax, Trans Union and Experian.

4. Home equity lines or home equity loans differ to refinancing because it does not affect the initial and existing credit. These loans are not offered to secondary market so borrowers may have higher risks. Home equity loans are regarded as the best source of money at a low interest rate (as low as 6%)

5. Signature loans. These are personal loans and are only secured by the borrower’s signature. Banks offer these kinds of loans without collateral. These are classified as unsecured loans.

6. Payday or quick cash loans are loans which are acquired by borrowers by advancing their salary through their paychecks. Similar to signature loans, these kinds are also unsecured. It is very easy to apply for a payday loan because there is no credit check and borrowers can apply online. Approval only takes within minutes and one can borrow up to $1500 which can be available the next day but interest rates are usually high.

7. Hard money loans are made by private lenders who specialize in private funds and hard money lending. The loan typically lasts from 2 to 28 months. It has a higher interest than traditional loans. There is also hard money residential loan but it is more risky because it has a very high interest rate. Borrowers need to have 25 to 50% collateral like real estate, assets like stocks or bonds.

8. Loans for students. There are lenders who provide loans to students who want to continue their education even if they have a bad credit standing. The examples of these student loans are:

- Perkins loan which is a government subsidized loans for undergraduate and graduate students. It does not require any credit check; and awards from $1,000 – $4,000 cash per school year.

- Stafford loan which is a federal loan with two kinds: Subsidized loan which is awarded fully depending on the economic needs of the borrower. The government is the one who pays for the accrued loan interest. O unsubsidized loan is not dependent on the needs. Students can always apply for this loan; however if the student carries multiple kinds of loan, he/she can only get a meager amount.

There are those loans for students pursuing a course in health and sciences such as:

- Nursing loan program which offers up to $4000 to qualified nursing students. Students who are currently enrolled must prove their financial need. The qualified recipients will be given a grace period of 9 months to pay for the loan.

- Disadvantaged students’ loan which is a program sponsored by Department of Health and Human Services. This type of loan is available to financially and/ or socially incapable students who want to pursue an approved degree in health sciences. The loan provided is non credit based and low in interest.

- Primary care loan which is a program designed to offer non credit loans for students who want to pursue medical degree on primary care. The grace period is up to 12 months.

The different loans above are designed for you to get you back on a good financial standing again after creating a bad credit record. Once approved, loans must be used carefully so as to prevent bankruptcy. Always pay on time and manage your cash correctly to avoid bad credit.

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