Will Online Payday Loans for Bad Credit Affect My Credit Mix?

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Being independent looks very appealing and cool. You do everything on your own, from paying bills to managing all expenses. However, the truth is that not everyone is well equipped to handle their overheads with a monthly salary.

Most of them often succumb to borrowing loans or relying on a credit card to fulfill their desires.

However, taking loans too often and late payments leads to bad credit scores and multiplies credit denial risk. So, what can you do in such a situation? Well, according to the report of vegasnews.com, the best way to cope with such circumstances is by taking online payday loans for bad credit.

Why? Because payday loans are not included in the credit mix and are not affected by your credit score.


How are online payday loans beneficial?

You must be wondering, ‘If the ultimate solution is to borrow money, why not take a normal loan.’ The answer is the advantages of a payday loan over a normal loan.

  • Payday loans are easy to avail of (within 24 hours).
  • You can take a payday loan for small amounts.
  • You can get a payday loan even if your credit score is poor.
  • Payday loans do not affect your credit mix like other loans.


What is a credit mix?

You must have heard the phrase ‘Don’t put all your eggs in a single basket.’ That is what credit mix is. Basically, there are two types of credits:

  • Revolving credit: It includes credit cards and HELOC (home equity line of credit). Revolving credits don’t have an ending period. However, you do need to pay a minimum amount due every month. And if you want to improve your credit score, you can pay even more than that.
  • Installment credit: It includes mortgages, auto loans, personal loans, or student loans. In contrast to revolving credits, installment credits have an ending date. You need to repay this loan in small amounts every month till the specified date.

Do you know, a mix of both these credits determines your credit score up to 10%. Moreover, all the financial institutions look at your credit mix to finalize the lending decision. It helps the lender in knowing your capability to repay the money.


Consequences of Bad Credit Mix

Even if you have both types of loans, i.e., revolving and installment credit in your credit mix, it doesn’t mean that you have a good credit score. Non-payment or late payment of your dues, high credit utilization rate, and long credit history will impact your credit mix.

A bad credit mix implies a bad credit score and rejection of your loan application. However, the credit mix doesn’t include a Payday loan and title loan. Hence, no negative effect on your credit score.



The main cause of rejection behind loan applications is having a bad credit mix. Furthermore, even if your loans get approved, it will hurt your credit mix, which for sure you do not want.

Here, an online payday loan for bad credit acts as your lender of the last resort.

With payday loans, you can fulfill your every desire without compromising with your credit mix.

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