Taking out a secured loan for a person with fair credit is a great way for them to get approved for a loan but unsecured loans with fair credit are a much more common occurrence. Not everyone understands though exactly what the difference is between a secured loan and an unsecured loan. A secured loan is one where you put up something of value that you own as a sort of collateral. This is usually a house but could also be something else that is much more valuable than the price of the loan like a piece of land. If you are to default on the loan then the lender will take your collateral as a means of paying off the loan. An unsecured loan is just a loan straight up with no form of collateral.
An unsecured loan will often come with a much higher level of interest especially an unsecured loan with fair credit. For people that don’t have anything of value to put up for collateral this is often unimportant as they don’t have anything to put up to make them regret not being able to get the lower interest rate. Without the collateral there are still some ways for you to go about obtaining the unsecured loan with fair credit but it is often a bit of trouble to find someone who is willing to lend to you.
Going to a traditional bank it might be almost impossible for you to get an unsecured loan with fair credit. The only exception to that would be if you had a friendly relationship with someone in the upper management level of the bank. Even then the interest rate will probably be very high because of the risk that they will be taking to lend money to you.
A better bet for you would be to go to a smaller bank or better yet a credit union. These sorts of institutions work on a much more personal level with their customers so you can have a better chance at explaining some of the negative areas of your credit score. If the credit union believes that the mistakes you have made were not too major and that you can be trusted for a loan then you might have a chance at getting approved and at a better interest rate than with a traditional bank.
If the credit union still doesn’t work for you then you might want to consider trying peer-to-peer lending as the funds will be coming from an individual and not from a bank. This means you have a much better chance of explaining your situation and what you will need to the money for. It might take a while until you meet the right person who wants to give you a chance but there is always that chance.
It can be difficult to take out one of these loans but try not to get discouraged. Taking out an unsecured loan with fair credit is possible, just requires some alternative tactics.