$5,000 Personal Loan With Bad Credit: What Is Your Best Option?

Once upon a time, having a bad credit rating was akin to being blackballed by the lending industry. It was difficult to get approval, making it even harder to lift yourself out of financial troubles. But today, lenders are more open-minded, so that even a $5,000 personal loan with bad credit is within reach to the qualifying people.The question is where to apply for the loan. Traditional lenders are not only reluctant to grant approval with low credit scores, but charge high interest rates and impose strict penalties whenever they do grant it. Getting the loan sum needed can become difficult simply due to affordability.So what are the options available to bad credit borrowers in need of a cash injection? It is important to know the full extent, so the best personal loan option can be selected. We've listed just three of the options worth considering.1. A Family LoanAs the name suggests, this option refers to loans granted by a family member. Normally, it is a safe option with the only issue being whether or not the family member has the money required. So, when seeking a $5,000 personal loan with bad credit, your parents, brother or sister would need to have $5,000 at hand.The key advantages of this option is that approval is practically guaranteed, with family ignoring the issues surrounding approval with low credit scores that financial institutions care so much about. Also, usually there is no interest charged and the repayment term is extremely flexible.However, this option is also exclusive of the lending industry, and therefore repayment of the loan has no impact on your credit scores. Getting the necessary personal loan is pretty easy, but remember to write down terms and have everyone involved sign them. This saves confusion and disagreements.2. A Company LoanIt is not the most common loan option, but many people are turning to their employers in an effort to bypass the uncertainty when applying for a $5,000 personal loan with bad credit from traditional lenders. However, there are negative and positive aspects when it comes to this option.On the plus side, your employer is the source of your income, so repayments are simply deducted from your paycheck. This means it is impossible to default on the loan. This certainty means the issues surrounding approval with low credit scores have no bearing at all, and with an interest rate charged (usually small), your employer can make a small profit too.The chief negative is that a company loan is exclusive of the lending industry, so your credit score will not improve when the loan is fully repaid. It is important to agree definite terms with your employer before signing any personal loan agreement.3. Online LendersThese are common sources for applicants seeing practically any kind of loan, whether a mortgage, auto loan, home improvement loan or even a $5,000 personal loan, with bad credit. While traditional lenders are the principal source of loans, online lenders charge lower interest rates and offer more flexible repayment structures.What is more, as experts in bad credit lending, they also have loan products perfectly suited to bad credit borrowers, that are structured to be affordable to practically all. So getting approval with low credit scores is no trouble, so long as the basic criteria are met.However, there are risks in providing financial information over the Internet, and to unfamiliar lenders. So, check out their reputation on the Better Business Bureau website before agreeing to any personal loan deal, and look for the signs that their sites are secure.