Credit Cards Key » CreditCardsKey » Top Credit Cards » Can you take out a loan while enrolled in credit couselling?

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  #1 (permalink)
: If my sister has already enrolled in credit counselling, couldnt her counsellor find out she took out a loan and they would no longer help her? I told her they might drop her case file and no longer help her. She says they can only see the debt she has claimed with them, and that they can't find out. Is this true???
She just wants to get a payday loan... she is already approved for it...... they dont do credit checks.

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  #2 (permalink)
: her credit is seriously bad,,, she will not qualify for any loan,, just scams.
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  #3 (permalink)
: I'm sorry, but Caren's right. It's bad enough that her being enrolled with a cccs company is going to be on her credit report. If she has had to go that route to have someone else help her handle her finances, she can't afford, nor can she qualify for a loan. People go with these companies to get out of debt, not create more, so even attempting to get a loan is counterproductive to her goal. If she finds a lender, she will be charged an extreme amount of interest because she's a high credit risk.

A payday loan is even worse because those companies charge so much in interest (as in 400%) that by the time the company cashes her postdated check she agreed to upon signing up, much of her paycheck will be missing because of the interest and fees for lending her the money. They're so bad in fact, that it's banned in certain states (mine included) because it's considered predatory lending and usury. With a chunk of her check missing by her payday, she'll have to borrow again to cover all her other expenses and get stuck in a vicious cycle of borrowing money to cover bills she couldn't cover. On top of that, if she doesn't have enough to cover her cccs payments on time, her credit card and finance companies will terminate their agreement with the company. Then she'll be back at square one. Please encourage her to try to fix her credit so she won't have to resort to the most expensive means of borrowing money.
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  #4 (permalink)
: Payday loans rarely go on credit reports unless you don't pay them back and they go to collections. But if she needs a payday loan, something is really wrong with her finances, they are really risky with massive fees and not worth it at all.

Might be time to get a budget put together and analyze spending to see why she's so short on cash. She's definitely overspending somewhere.

As far as new credit, if she applies and gets something added to her credit report, they will drop her like a hot potato. They are very likely soft pulling her credit report monthly, if not more frequently.
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