Of course, everyone would like to think they qualify for a cheap secured personal loan, but such is not the case. In fact, the best rates are reserved for customers with the highest credit rating, and no matter how much you try to find your way around it, unless you have dealt with a particular lender in the past and have a good relationship, there is no way you are going to get the lowest rate unless your credit substantiates it.

How to qualify

The most important factor in qualifying for a cheap secured personal loan is, of course, your credit rating. It’s important to keep in mind, though, that your credit is most assuredly not the only factor that a lender uses to determine your credit worthiness. In fact, depending on the lender, it may not hold as much weight as some of the other factors that are use in determining both credit worthiness and financial stability. Some of the other factors a lender uses to determine your eligibility for a loan include one or more of the following:

• Credit rating/score

• Employment stability

• Income

• Debt to income ratio

• Age of newest adverse credit item

• Longevity of current employment

• Banking experience (checking, savings, loans, CDs, etc.)

Each lender will make his own determination regarding the strength or weakness of each of these items, and will in turn make a determination based on that information. The important thing to remember is that the word of one lender is not the word of another, but do not apply to several lenders at the same time. If you have been turned down by one, then certainly feel free to try another lender who may have less stringent policies.

Negative or positive results

It’s difficult to sit and wait for a decision on a loan, especially when you are waiting to obtain a cheap secured personal loan. You’re not sure what to expect, and you want to hear the answer as soon as possible. For those who have adverse credit, the process is even more difficult, but it’s also difficult for the lender because he must decide if he is willing to take a chance on someone who doesn’t have the best credit. During the application process, you must give him something positive to go on, and then it will be easier for him to make a positive decision. That can be something as easy as informing him that the bad credit was the result of being laid off for several months, because then he knows you had justification. Keep in mind he has only your word to go on, so the more reinforcements you can give him, the better your chances.

The final steps

Once you have filled out the paperwork, and the lender has made a decision, you can move forward if you are approved. If not, and you did not explain the reasons for any negative remarks, you can try appealing to him at this time, but in most cases, if you weren’t up front about it, the damage is done. Sometimes before the final decision is rendered the lender will contact you to ask about the credit issues, and at that point, you should let him know if you haven’t already. Once the decision is made about your cheap secured personal loan, the lender isn’t likely to change it.