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No credit check loans
The problem that now exists is that people have low income, low savings and either their credit is weak or there is no credit at all. When you fall into such a financial situation you are then faced with the question of which loan to apply for without harming your credit score. No credit check loans are loans that do not require the lender to conduct a check on your credit before giving you a loan.
Credit checks are an integral part of the loan process and it gives the lender information about the individual or applicant of the loan. In times past it was prime to have your credit checked before you had access to loans from lenders. But now, lenders have made way for no credit check loans to be given out.
What then is credit history
Credit history refers to a record of how individuals have managed debt. The information is then recorded in a credit report.
Credit history includes the different accounts that you have had, how long these accounts have been open and the amount of credit that has been used. It also touches on payments that you have made – whether late or early and the number of credit inquires that have been done on you. All this is kept on the credit report.
Defining credit reports
Credit reports are a record of the past financial dealings of an individual. This includes any credit products that they have subscribed to or used before.
Credit reports are reports that are collected by credit bureaus / credit reporting agencies. They are sold to lenders at a fee when they request for them. All lenders use credit report to grant loans to individuals.
The creditworthiness of an individual is gotten from credit reports and credit scores that are provided.
You can check online for your credit score but with credit reports they are handled by credit bureaus or credit agencies. There are three major credit bureaus: Equifax, Experian and TransUnion.
These are the main companies that deal with the individuals accumulated financial history. When lenders need to know the financial past of those who want loans from them, they can check on their credit report.
How credit history determines credit scores
Credit scores of individuals are found in the credit report that is provided. The overall score that you get is based on some factors based on your credit history.
One of the most important things that affect the credit score is whether you have made timely payments on your loans and the debt that you currently have.
You should not have overused the credit available to you. For example: maxing out your credit cards have a way of hurting your credit score.
The length of your credit history can also affect your credit score. The longer the credit history, the better your credit score. Recent users of credit will have to wait for a while in the use of their credit before their credit scores improve.
The history of your credit mix also affect the credit score. This is referring to the types of debt that you have handled. It can be student loans , credit cards, mortgages. To have a good credit history means you have been able to ensure that all these different credit that you took was properly held.
A credit history which reflects a lot of credit inquiries also has a way of affecting your credit score. This can spell doom to those looking for loans and therefore when they find no credit check loans, they are quick to apply.
How credit history determines ones credit score continued
Credit history contains the total number of accounts you have open and any accounts closed in the past 7 years.
The accounts include personal loans, student loans, auto loans ,mortgages and all different types of multiple credit lines opened. Lenders are pleased with those who are able to manage their credit well.
This shows up in the credit history and eventually on the credit score positively. However, if you will not be able to manage the credit effectively, it is advised not to open them up just to increase your credit accounts.
A notice of a debt to be paid, can negatively affect your credit score. This is because the issue of payment has been sent to a collection agency or third party.
If you have in your record an issue with debt collectors, it is a negative in your report and can cost you greatly. Hence if someone comes across a no credit check loan, they accept the offer gladly because it can be tough to get loans when you find yourself in this situation.
On the other hand, if you have credit lines that has been opened for quite a while, your credit score can increase.
The catch here is that if you have managed your credit well over a longer period of time, your credit score looks good.
For every credit product that you choose, if you are able to handle the payment well it proves how responsible you are to the lender especially with credit cards for example.
Why does credit check matter
Credit checks matter because it is what enables the lender know who they are dealing with when it comes to giving loans out.
It enables the lender to decide whether they will approve a loan or any credit. Credit checks be it hard of soft have their own implications.
When a lender conducts soft credit checks, it doesn’t usually appear on your credit report. Soft credit checks are for when you check your own credit score or approved for a credit card. Soft credit checks can be done by the lender without your knowing but it won’t affect your credit.
With hard credit checks, it can affect your credit. Do not be enthused with too many hard enquiries on your credit report. Multiple enquires within a short period of time can damage your credit score greatly.
It can cause the lender to refuse your application because you will come across as someone in desperate need for money.
Also lenders will take it that you are mismanaging money or you are accruing more debt but have no plan of paying what you currently owe.
This increases the risk. Credit checks does not exist to make things difficult for the borrower but it exists as a due process for giving out loans.
Credit scores also shows the level of risk that the person carries or how much risk to expect from the borrower.
A low score portrays high risk whilst a high score shows that you are less risky to lend to. Every lender is very concerned with risk. Their main question is “what if they give out the loan you are not able to pay back?”.
Can I get no credit check loans without established credit
Yes, you can! No credit check loans are for exactly this purpose. It will however take some work to find a lender if you are looking for larger loans of about $100,000.
Lenders who give no credit check loans are now found online. They are easy to locate and are taking advantage of the technology available to give loans to those who do not even have credit. Provided you are not looking for larger amounts, you can have access to no credit check loans.
These lenders look at your income and financial habits to predict creditworthiness and not only the credit scores. It therefore gives the opportunity for people to get loans even without credit checks.
Traditional banks will hardly have options for no credit check loans because they are not high risk takers. They are not ready to take on borrowers with no credit history. They can decide not to lend with those who have no credit or bad credit.
This is due to the risk factor of them not being able to get their loans back. Your credit report will show the lender your past habits with loans.
Ways to get no credit check loans
Your credit history and other factors can stand in your way sometimes when you want a loan. Nevertheless there are also different options that you can use to get no credit check loans when you need them. Some are mentioned below.
1. Lenders who accept co-signers
A close relative or a friend who has a good credit history and be of help to get no credit check loans. When their credit history is stronger than yours, they can co-sign your loan for you. This enables the persons credit status to cover yours.
Credit history and employment status are the main determinants that the lender uses to create the terms and conditions of the loan. In the case of default, it is the co-signer that will pay back the loan.
2. Using alternative lenders
If you do not have a co-signer, and your credit score is not able to support you to get a loan, you should consider alternative lenders. There are different organizations that provide loans as alternative lenders to even those who are non – citizens of the country.
Students in need of loans can also look to specialized lenders for no credit check loans. Student loans do not require a lot of stringent credit checks.
Such loans are given with the hope of future earning potential of the borrower. You will however, have to ensure you meet the eligibility requirements.
3. Friends and family
This proves to be one of the most inexpensive methods of borrowing. You can ask from your loved ones and those you have a close relationship with.
You should however have a form of contract signed to ensure that both parties know what is expected when it’s time to repay. There are specialized companies who help with creating these contracts and terms so that these family and friends can earn interest and get better rates..
Friends and family are a good example of no credit check loans. To get these loans, your friends and family may not conduct a credit check on you before you get the loan.
4. Community development financial institutions (CDFI’s)
CDFI’s are similar to local banks and credit unions. As the name states they offer financial help to community member who have poor or no credit at all. The aim is to make funds affordable to everyone.
The loans amounts are usually not huge but they have good rates. These rates sometimes compete with even what you find at the short – term lenders.
Community development financial institutions are the best example of no credit check loans. No credit checks are done on you before you get the loan.
5. Credit Unions
Credit unions also have their role to play when it comes to giving no credit check loans. They have low loan rates.
They provide different loans options to its members including those with no credit history. You can get access to affordable but smaller amounts of loans from credit unions.
They have programmes that ensure that anyone who comes into their establishment and does not have good credit or no credit at all get access to loans at the end of the day.
These programmes ensure that you develop healthy habits as well as enjoying good terms and conditions from them. You would have had to be a member for at least a month. You can get loans between $200 – $1000 and pay back within 1- 6 months.
No credit check loans are a way out after a bad credit rating
Many people think those with no credit or bad credit have little to none chances when it comes to getting loans.
This is not entirely true though because of the coming of no credit check loans. It means those with bad credit have a chance to get back on track.
The view of lending institutions against bad credit ratings or low credit caused many people to be rejected for the loans they applied for. The general view was that they were likely to default on their loans.
But now, there are loans that are approved with no credit checks. This is a situation that lenders had to adjust to in order to face the reality of people not being able to sustain good credit due to several reasons.
When borrowers fall into hard times, lenders have become more forgiving in trying to understand their credit situation.
This situation can possibly be as a result of losing a job, loss of income and therefore giving no credit check loans are appropriate to help them out of difficult financial times.
Lenders giving no credit check loans view the situation as temporary and thus have the hope that it will improve. That is the background against which they give these loans to those in need of them.
They believe that had the circumstances of the individual not changed, they would have been able to qualify for a variety of loans that require credit checks.
But the temporary financial pinch meant they have to resort to no credit check loans as a way out of their bad credit situation.
The purpose of credit check loans
The purpose of no credit check loans was for individuals with bad credit to be given a break after experiencing harsh financial conditions. This includes bankruptcy, defaulting, late payment and the likes.
This can sometimes mean higher interest rates to be paid by loan seekers. No credit check loans that are offered to borrowers are to give them a chance for them to regain their reputation.
It will however depend on whether the borrower is taking a secured on unsecured loan.
Secured loans will mean a longer process in getting the loans which may not be favourable to those with bad credit.
The purpose of no credit check loans is not so that you borrow huge amounts but only what you can afford. This is because a default will mean your credit score will further be affected.
The aim for giving no credit check loans will be defeated at the end of the day.
Some factors of no credit check loans
No credit check loans have become convenient because it takes out the component of credit history before you can apply for a loan. It favours those with bad credit or no credit at all to also get loans that they need.
It doesn’t however mean that no credit check loans are free. You will still have to meet some criteria before you get access to the loan.
No credit check loans given by lenders gives them advantage over those who still require credit checks before giving out loans.
It increases their customer base as borrowers will be more attracted to firms that do not insist on their credit before giving out loans.
There is no shortage of clients for them. Despite the great risk that lenders take in giving no credit loans, they get more clients and therefore compensate themselves with the interest rates.
No credit check loans are normally not in huge amounts. You have within 30 days to pay back the loans. Interest loans can be up to 30%. Fast approvals does sometimes come at a price.
Finally, when it’s time to repay no credit check loans, it is usually taken from the pay check of the borrower in one lump sum.
This suggests that the borrower needs enough money to be able to pay back the loan and also cater for their personal expenses. If the repayment it stretched due to some reasons it will have to be by a special arrangement with the lender.
What to look out for when searching for no credit check loans
When searching for no credit check loans, you should check whether your income will be able to support the no credit check loans you are going in for.
There are different options for getting money approved easily to you when you need it. You can have access to payday loans, auto title loans, cash advances.
One thing to remember is that not being able to pay back the loan can land you in an uncomfortable financial situation which can affect you.
Should you choose payday cash advances, for example, it will require that you write a post-dated check for the lender when the repayment time is up. Others may request for checking account information to withdraw the money when its due.
You can also come across auto title loans in your search for no credit check loans. Lenders will be concerned about how much you car is worth and how they can get their money back.
The amount that lenders will be giving to you depends on the cost of your car. There is a minimum value that lenders give on auto title loans.
In all, your credit score and credit history can be enhanced by making regular payments on time with the loans that you have. You can also consider changing your spending habits and budgeting behaviour so you can rebuild your credit history.
By remaining consistent with the loans you have, it will affect your credit scores and therefore make you more creditworthy to borrow to.
A bad credit score doesn’t mean it’s the end of the world, there are no credit check loans available for those in need of them.
To get no credit check loans , lenders check your employment status and debt-to-income ratio when they are reviewing your application. With no credit history at all, you can also decide to start by picking up credit products in order to build your credit score. As its said; half a loaf is better than none.
The best place where no credit check loans can be found is on the internet.
The traditional lenders will not usually give it due to the risk associated with it. There are lenders who will still approve these loans when the monthly payment is assured. Once they are sure of this, credit checks are not necessary to them.
Disclaimer: All loans offered through this website are subject to credit and underwriting approval. AfterLoans.ca is a lead referral company, not a lender. AfterLoans only works with financial service providers that adhere to Canadian laws and regulations. Our lenders lend from $500-$5,000. Loans amortization is between 6-36 months. APRs range from 19.99% to 55%. The actual APR charged will depend on the lender’s assessment of your credit profile. For example, on a $1000 loan borrowed for 12 months at 29.9%, the monthly payment will be $97.24; with a total repayment, including interest, of $1166.88 There is also lender’s optional loan protection policy. In the event of a missed payment an insufficient funds fee of around 45$ may be charged (dependent on the lender). If you default on your loan payment plan the lender may terminate the plan and the remaining balance will become payable immediately. Our lenders employ fair debt collection practices, but will pursue the payment of Outstanding debts to the full extent that Canadian law allows.