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There is a general belief that securing bad credit loans is so easy, that all you need is a source of income to get approval. While bad credit loans are indeed easier to secure than regular bank loans, having a stable source of income—no matter how huge your income is—is no guarantee that you can get bad credit loans approval. To ensure approval and avoid wasting your energy and time, here are some tips which may help get you the money you need.

1. Know what the loan is for

First, it is important to determine where you intend to use the money. Remember that each type of loan is designed for certain purposes, so make sure that the loan you intend to take out fit your purpose. Do you need money to purchase a house, a car or pay for an emergency medical bill? You also have to keep in mind that bad credit loans come in many forms, including payday, cash advances or installment loans. If you are looking to make a big purchase, such as a vehicle, you can also obtain bad credit loans which are designed for such a purpose. Knowing exactly where you need the money for will guide you to which type of loan you should apply for.

2. Determine when you need the money

The urgency of your financial need is also another important factor to consider. Can you wait for weeks to months to solve your financial problem? Or do you need the money as soon as possible to solve a problem right away? If you can wait for weeks to months, then among your options would be to obtain bad credit loans from traditional lending institutions such as banks. Although banks generally require good credit standing for regular loans, many banks also offer bad credit loans to people with poor credit rating or those who do not have a credit history at all. However, if your need is quite urgent, such as you need to fix your broken car right away to go to work, or need a dental fix as your health insurance does not cover it, then one of your best solutions is to obtain bad credit loans from online bad credit loans lenders. This is, of course, next to seeking help from a friend or family who can lend you the money without interest.

3. Keep your bad credit loans application realistic based on your income

Now that you have already determined what type of bad credit loans you need and where to obtain a loan from, learn how to convince lenders of approving your loan application by making your application realistic.

The degree of the significance of your income is actually more than how much people think. Many people think that as long as you have a stable source of income, you can get bad credit loans approval without hassles and problems. The truth is that it all depends on this: debt-to-income ratio. Even if you enjoy a $6,000 monthly income, you still won’t get an approval if the debt that needs to be covered by your monthly salary is more than 40% of your income.

Keep in mind that the debt-to-income ratio is set at 40:60. This means that most bad credit loans lenders usually just approve at most 40% of your income to ensure that you can pay back the loan and that there is still enough left over for you to deal with your everyday and even unforeseen expenses.

Indeed, securing bad credit loans is more than most people think. Securing bad credit loans is not just about being able to provide the necessary documents or to have a stable source of income. To ensure bad credit loans approval, you should also prove to the lender that you can pay back your bad credit loans even during worst situations.