How to Get Computer Financing with Bad Credit – Available Options And Guide on Choosing The Best Loan

A computer is no longer a luxury item. It’s a must for many aspects of life, including business, education, and entertainment. Instead of saving money, which means you need to wait, people are used to taking advantage of various financing options with no down payment. These alternatives allow them to buy a laptop right away and repay the money over some time. But is it a good idea to take out a loan to purchase a laptop? And how to get computer financing with bad credit? These are the questions we’re going to answer below.

What Are Computer Loans?

As the name suggests, computer loans are borrowing options designed to help people purchase laptops or other technological equipment. They allow you to split the cost of your laptop and repay it in fixed monthly payments within a few months or years. These loans are usually unsecured. This means that you don’t need to put up any collateral as a repayment guarantee. Interest rates on such loans vary widely depending on the lender, loan type, and borrower’s credit history. Sometimes an APR may be as high as 36%.

Although it seems obvious, we should mention that most computer loans are just regular personal loans that can be used at your notice. They allow borrowers to buy new equipment, upgrade the existing one, purchase some related items, or even cover any other needs with the help of the remaining amount. At the same time, there are some specific-purpose options that can be granted toward the cost of your laptop only. This can be applied to in-store financing or payment plans offered by manufacturers.

How Much Do You Need to Purchase a New Computer?

A new laptop or a desktop computer can cost you between £500 and £3,000, depending on its technical characteristics and the brand. However, if you want to improve its appearance or buy some software you need for your business or education, get ready for additional expenses.

Also, keep in mind that it’s not always possible to get exactly the sum you need to cover the full purchase amount. If your income is insufficient to service your potential debt, a lender may reject you or approve you for a lower loan amount. Also, some service providers may require you to make a down payment. Thus, you will be asked to pay a part of the computer’s cost upfront.

When Should You Consider a Laptop Financing Option?

Laptop financing can be a smart choice for many people. This option allows you to get the technology you need without putting undue stress on your budget. Here are a few scenarios when computer financing can be a great idea:

• You need a laptop for work. If you’re a freelancer or work remotely, having a reliable laptop is essential. But sometimes, when you are just starting to take steps in a new business, you may not have spare money to buy a computer. Financing a laptop can allow you to get the equipment you need to reach your financial goals;
• You’re a student. Many students use laptops for coursework, research, and communication with professors and classmates. Also, they may not have enough money to buy it outright. A computer loan can be a smart way to get a laptop for school without sacrificing a budget;
• You need to upgrade your current computer. If you have an older PC that is slowing down or no longer meeting your needs, financing a new laptop can be a smart choice. Upgrading to a newer model can help you work more efficiently;
• You need a high-quality laptop that is out of your budget. For some work purposes, you may need a good computer with high performance and with a hefty price tag. Financing options can allow you to split its cost and make it better suit your budget. You can also take advantage of promotions that might not be available if you were paying upfront.

What Credit Score Should You Have to Get Computer Financing?

Most lenders are more likely to deal with borrowers who can demonstrate a strong credit history. This is because a good credit score indicates that you’re a reliable borrower who tends to make payments on time. In contrast, a poor credit history suggests that you’re a high-risk applicant who may not be able to repay the loan when due. The higher your credit rating, the better loan terms you can get.

Even if you’re going to take out a computer loan for your business, lenders will check out your personal credit score if your business is new. However, each credit bureau has its number for what they call “good credit.” Here’s a table with credit score ranges depending on the credit bureau:

Thus, you need to review your credit report details through the credit bureau that a lender uses to review your creditworthiness.

What Are Your Options for Laptop Financing with Bad Credit?

People with low credit scores can still access additional financing. Here are some ways to get a loan for a computer even with bad credit.

Secured Personal Loans

Secured personal loans can provide you with the amount you need against some of your valuable assets. It can be your house, car, or the balance of your savings account. The money will be transferred directly to your active bank account, and its further use is not tracked. You can spend it for either business or gaming PC financing. However, financial institutions always make a hard credit check through major credit bureaus. Thus, applying for a personal loan can affect your credit rating. Also, if you have a poor credit score, you may be offered a higher interest rate.

Student Loans

If you need a laptop for your education-related purposes, feel free to apply for a student loan. This form of aid often has competitive interest rates and can sometimes be obtained with all credit types. However, you will be asked to meet certain requirements to qualify.

In-Store Financing

This form of borrowing can be a great solution for people who don’t have much time to do research and compare options. In-store loans offer an easy financing process that allows you to get the money on the spot without visiting a lender and going through its long verification process. But note that this form of financing may require a down payment. You may be asked to pay a portion of your computer’s cost out of pocket.

Computer Leasing

This option can work for individuals or businesses that are looking for more flexibility. Leasing always comes with paying interest and fees, but you don’t own the computer. Your lease agreement provides that you can use the laptop within the agreed-upon period. At the end of the lease, you can turn your computer back without worrying about reselling or disposing of it.

Things to Consider Before Accessing Computer Financing with Bad Credit

Well, you’ve explored your options and decided on what type of loan works better for you. But don’t rush to fill out a credit application immediately. Here are a few things you should consider to ensure that you are making a smart financial decision:

• Interest rates. An interest rate is the main factor that determines your loan cost. Although bad credit loans are always more expensive than conventional ones, lenders’ charges can range widely. Make sure you get an offer with reasonable rates by comparing several options;
• Fees and charges. In addition to your loan interest rate, lenders may ask you to pay additional costs for processing your loan. Read your agreement carefully and make sure you understand the costs associated with your loan. They may include annual fees, late fees, prepayment penalties, and more;
• Repayment terms. Before you sign on the dotted line, make sure you understand your repayment plan and sue dates suit your paycheck schedule;
• Alternative options. Maybe you can wait a bit and save up to pay in cash? Or do you have an existing interest-free credit card and can use its balance to finance your purchase? Make sure you make the best possible decision in your financial situation. 

Final Thoughts – Is Bad Credit Computer Financing Possible?

Although most lenders are more likely to approve borrowers with a strong credit and payment history, bad credit borrowers still have a few options to access computer financing. Of course, when you buy a laptop outright, it will cost you less. However, financing options give you an opportunity to take advantage of your purchase now and repay its cost later. Just choose the right type of loan before you get into debt and enjoy the benefits that a new computer can bring to your business, education, or private life.