What is a No Credit Check Loan?
As the name implies, a no credit check loan is a type of borrowing that does not require any credit check. The lender does not consider the credit score of the borrower an important factor in deciding whether the loan request will be granted or not. If you are looking to get a loan but your credit score is flawed, it is still possible to obtain a loan from the right online lender.
No credit check loans are usually short-term types of borrowings that come in handy when there are urgent issues that need to be sorted out. Despite the claims of lenders that they offer no credit check loans, they still perform an inquiry on your credit history. No credit check loan providers run a soft inquiry on the borrower, not as a basis for their rejection or approval, but to get to know the loan applicant.
No Credit Check Loan Advantages
• Hassle-free application
Applying for a no credit check loan is not complicated. You only need basic information such as your name, age, work and salary information, and bank account details. Upon completing and submitting the application form online, all you have to do is wait for the lender’s decision. There is no need to head over to the lender’s office to submit the loan request. It is possible to complete the entire loan process in the comforts of your home or office.
Online lenders will not ask for any complex information. The requirements are also easy to fulfill since one only needs to prove his income and affordability. After providing the personal details and salary requirement, a borrower can easily qualify for credit. The funds will be transferred immediately on the same day or the following business day. And because the loan application is done virtually, there is no paperwork involved. Online lenders offer simplicity and convenience.
• No hard credit checks
No credit check loans are very convenient since you won’t be subjected to any hard credit verification. Your credit score can be negatively impacted by hard credit checks since these will show up on your credit record. The advantage in getting a no credit check loan is that online lenders will only conduct a soft credit inquiry that leaves no negative marks on your credit reputation.
• Safe and secure
Reputable and established online lenders are concerned about the safety and security of their clients, especially where sensitive personal information is concerned. Their websites use top-notch data encryption and protection to make sure intruders are unable to steal your data.
• Speedy approval
Unlike traditional lenders, online lenders work fast which is appropriate for borrowers who are in urgent need of funds. For borrowers, waiting time is very minimal since the results of the application will be available as soon as possible.
• Short-term loans
No credit check lenders offer short-term loans that you can settle within a few months and up to five years. The advantage of short-term loans is that you can be debt-free earlier. If you handle your repayments well, you can take advantage of loan offers with better rates in the future.
• Loans with variable amounts
You can obtain a loan with different amounts from a no credit check lender but the amount that will be granted will still depend on your affordability and creditworthiness. No credit check lenders will verify if you can manage repayments well before they decide on what amount to give you. Loans may have amounts ranging from $100 up to $50,000.
Understanding how no credit check loans work
Online lenders who don’t run hard checks on borrowers’ credit scores are normally payday lenders. If you want to obtain a loan from an online no credit check lender, you should prepare all the information that the loan provider will ask for which normally includes your details, employment, and salary information.
It is possible to finish the application process in several minutes. After applying, your request will be assessed by the lender who will immediately give you an update in a just a few minutes. Take note that the lender will still perform a very quick inquiry on your credit history before a loan deal is offered to you.
No credit check loan rates and repayments
It is important to understand that the interest rates of loans from a no credit check lender are typically higher than a regular lender’s. This is because the no credit check lender only uses your affordability and creditworthiness as a basis of approval. If your salary is high, you may be given a loan with lower rates. Whatever the interest rate a no credit check lender applies on your borrowing, you must be up-to-date with your scheduled repayments.
The loan provider is responsible for providing you the details of the loan. The repayments will vary depending on the type of loan. For example, a payday loan should be paid back in full by the following payday. If this is the type of loan that you obtained, you should budget your income well so you do not miss out on any payments.
If you took out an installment loan, the monthly payments will be set for a specific period. Similar to payday loan repayments, you must manage your finances well to have enough for repayments and your living expenses.
If you’re looking for a convenient way to handle loan repayments, you can try setting up automatic payment schedules from your bank account but you must have sufficient funds by the time your due date arrives. The lender collects your payment without you having to worry about due dates at all.
No credit check loans are subject to fees, too, just like other types of loans. You should verify the fees associated with your loan from the lender, which may include origination fees, processing fees, cancellation or prepayment fees, and late fees. The lender may reduce or remove some of the fees, depending on the situation.
One of the fees that will increase your loan cost is the late fee. You can avoid being slapped with late fees if you are conscientious about due dates. Paying late will not only result in costly fees, but it will also negatively impact your credit rating.
Late or missed payments will be reported to the relevant agencies and come up when someone pulls up your credit record. Delinquent payments will also hurt your relationship with the lender, making it difficult to access credit in the future.
Before taking out a loan, it is important to look around and take time to research before applying. You should also be aware of and steer clear of scammers posing as legitimate lenders.
Why Choose Unsecured Loans?
Unsecured loans can help you out during the direst situations. If you need cash fast, unsecured loans like payday loans are the right choice for you. It’s fast, convenient, and highly reliable.
Unsecured loans other similar types can be extremely helpful during emergencies. However, most unsecured loans have high-interest rates compared to secured business loans. Loans with high-interest rates can be difficult to deal with. So choose the right deal that’s best for you.
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