Bad credit scores can provide a major hindrance when it comes to getting cash fast to deal with financial emergencies. But some alternative lenders provide personal loans with no credit check, making it easier to access funds that might be desperately needed.
By waiving their right to check these histories, lenders are greatly improving the chances for applicants to get approval despite bad credit. In any case, credit scores are not the key aspect to approval anyway. More important aspects, like income and employment, can sway the decision.
However, the lower the score the higher the interest rate, so when ignoring bad credit, those with the worst histories are likely to benefit overall. Still, there are factors that should be known about these personal loans before one submits an application form.
Qualifications to Meet
Getting a loan approved with no credit check does not mean anyone can get funds whenever they want. It is still necessary to qualify for these loans. Only then can it become possible to get a personal loan with no credit check.
The qualifications are nothing new. The applicant must prove that he or she is over the age of 18, and is a US citizen (or has a permanent residency visa), and has held a full-time job for at least 6 months prior the date of the application. After all, getting approval despite bad credit depends on proving an ability to pay.
Also, a bank account is necessary for two purposes: firstly, if the personal loan is approved, the funds can be deposited quickly into the account; and secondly, when repayments are due, the amount can be taken automatically from the account.
Terms and Conditions
For the most part, getting personal loans with no credit check means getting secured loans. This is because security has been provided to cover the cost of the loan anyway. So, practically any amount of money can be applied for, as long as the value of the collateral matches the sum.
But it is also possible to get unsecured loan approval, despite bad credit suggesting a credit check would be wise. Most lenders offer no more than $1,500 because without security, lenders rely on the income and good will of the borrower to get their money back, so the lower the sum owed, the better the chances of that happening.
However, these loans are also very expensive, with interest rates as high as 30%. And often the full loan repayment is simple withdrawn in full from the next paycheck. Also known as a payday loan, this type of personal loan comes with high pressure repayment terms.
The problem when going to a traditional lender is that the lending policies are often old-fashioned. Getting a personal loan with no credit check is unlikely with most because they are not willing to accept the risk. Online lenders are more accommodating, however, it is the nature of the loans themselves that are the major advantage.
Since there is no credit check, it is easy to get lightning fast approval, despite bad credit. This means that financial emergencies can be dealt with extremely quickly. Not only that, but as long as the basic criteria are met, approval is all but assured.
In fact, as personal loans go, these are the most effective in dealing with needs fast, even if they are the most expensive.