Bad credit loans can either be put to constructive use or could be destructive based on what you use them for. The following is a list of some of the good uses of credit loans:

Cash loans: They are easier to get, and the transaction can be between two known parties. You can borrow cash from either a friend or a relative. Usually, on such loans, the interest rate is very low or absent as compared to loans obtained from banks or financial institutions.

Installment loan: As the name suggests, the loan can be paid back in installments over a period. Hence there is no urgency to clear the loan. These loans are used for the purchase of vehicles, furniture, etc.

Wedding loans: Weddings can be an expensive affair, and it may be difficult to produce cash up front readily. Even with a bad credit score, you can repay this loan up to 8-10 years, putting less pressure on you.

Government loans: They are used for purposes like the expansion of businesses, setting up businesses, student loans to name a few.

Other uses include loans for consolidation of debt, boat loans, and military loans.

Poor uses of bad credit loans:

Private and not government student loans: They have variable interest rates which are quite high in most cases, such loans cannot be deferred, and they cannot be forgiven, unlike federal loans. They swindle students and place a heavy burden on them to repay their loans. This is a huge problem faced by several students in the country, who end up with a very poor credit score as a result of this.

Small business loans: Loans from private firms come with high-interest rates and exorbitant monetary terms. Always choose federal aid over private aid if possible.