Need Alternatives To Cosigning A Loan? Here's Ideas To Try

Cosigning for a loan can offer significant risk to both the cosigner and the borrower. They will have to take on the debt should the consignee not be able to afford the repayment, making it a large personal risk for someone else’s debt. The borrower will have the pressure of repaying the loan to avoid hurting their credit and their cosigner’s credit, which can affect your relationship.

In this guide from At Home Title Loans, we will explain some alternatives to cosigning a loan for bad credit, including peer-to-peer lending, credit builder loans, and title loans. We will also go over how to get a loan without a cosigner through our car title loans.

Five Alternatives To Cosigning A Loan For Bad Credit

When you have bad credit, traditional banking institutions may require you to get a cosigner to receive an emergency loan. There are many personal risks for the cosigner, including increased debt-to-income ratio and legal liability for the debt. To avoid these risks, borrowers can seek loan options without a cosigner for low credit.

The following are five alternatives to cosigning a loan for bad credit:

1. Peer-To-Peer Lending

One of the best alternatives to cosigning a loan is peer-to-peer lending, which involves borrowing money directly from a family member or friend. This is not a loan, so there is no legal liability. Rather than affecting your and your cosigner’s credit score, you can borrow money directly from them to avoid credit drops and accumulating debt.

However, you should only do this with someone you are close to. It can add stress to the relationship as your peer waits for you to repay them. Only borrow as much money as you feel you can pay, as failing to get their money back in a timely manner can negatively affect your relationship.

It’s also possible your friend or family member may be unable to get you all the money you need. You should only do peer-to-peer lending for more minor financial emergencies that cost a few hundred dollars.

2. Credit Builder Loans

If you have poor credit and cannot get approved for personal loans, a credit builder loan may help. Rather than getting a loan with a cosigner, you can build up your credit first and borrow money on your own.

Credit builder loans work differently based on the lender. In most cases, you can get approved based on factors other than your credit history, such as your employment or residential history. When approved, the lender will deposit the money (normally between $300 and $1,000) into a savings or CD account. You will make monthly payments over six to 24 months.

After paying off the loan, the lender will unlock the savings or CD account, and you can access the money. While this is not one of the best alternatives to cosigning a loan if you need cash immediately, it can help you improve your credit and get approved for a bank loan without a cosigner down the line.

3. Secured Credit Cards

Another alternative to cosigning a loan for bad credit for those looking to improve their credit score is a secured credit card. It involves making a security deposit upfront that serves as your credit limit. This deposit provides security from banks to cover any purchases you make if you cannot make payments on time.

Every month, you must make payments for your secured credit card. This can help to establish a credit history. Improving your credit score this way can help you if you’re looking for how to get a loan without a cosigner in the future.

4. Personal Loans From Credit Unions

If you’re looking for loan approval without a cosigner for bad credit, a personal loan from a credit union could help. Credit unions are owned and operated by union members and can offer many similar services to banks, such as offering personal loans.

Credit unions are not run for profit, so they can offer personal loans with better terms than banks. You can get approved for a lower interest rate for smaller loan amounts with more flexible terms.

Before getting a credit union personal loan, you will need to apply for membership. You can apply online and will need to make a deposit to open your membership. Your credit union loan approval will depend on your credit history or your income.

5. Title Loans As An Alternative To Cosigning

If you need cash today for an emergency but don’t want a cosigner loan, you can get title loans as an alternative to cosigning. Title loans allow borrowers who have fully paid off their vehicles to use their car title as collateral to borrow money fast.

You won’t need a cosigner to get approved and can receive title loan cash regardless of your credit score. You will need a driver’s license, a lien-free car title in your name, and a vehicle for inspection to get approved. You will not need to have a cosigner and can get approved the same day you apply.

The following are some of the benefits of title loans as a cosigner loan alternative:

• Get approved the same day you apply
• No credit check required
• Use collateral instead of needing a cosigner
• Keep your car during loan repayment
• Receive your emergency cash within one business day
• Start the process online

How Can You Get Title Loans For Emergency Cash Today?

Do you think title loans are the best alternative to a cosigner loan for your situation? At Home Title Loans makes it easy to get approved today. We have simple required items and a process that takes less than a day. You can apply online in five minutes and get approved in person in less than 30 minutes.

The following are the steps involved in getting a title loan:

• Submit your information through our online form
• Speak to a loan representative on the phone about title loan terms
• Bring your required items to an At Home Title Loans store location
• Get your required items verified and your vehicle inspected
• Sign loan documents to complete the approval process
• Receive your emergency cash the same day you apply or the next business day

Apply For Title Loans Online Today – Get Quick Cash The Same Day You Apply

One of the best alternatives to cosigning a loan is to get a title loan. It allows you to get speedy cash the same day you apply and resolve any financial emergencies you have quickly. You can get approved with bad credit and get to keep your car during repayment. Contact us today for assistance by filling out our form online or giving us a call to discuss title loan terms.

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.