A no-credit-check loan is simply money borrowed from a financial institution without the applicant undergoing a hard credit check. Typically, before a loan is approved, the lender evaluates your credit score to determine your creditworthiness.
However, lenders of no-credit-check loans only conduct a soft check. Thus, this type of borrowing is ideal for people with little or no credit score. This is because their loan requests are likely to be turned down by traditional lenders like banks.
The easiest and most popular way to access these funds is by applying online. There is no paperwork, and you only need to prove you have a stable source of income. Keep reading this guide to find out how to get online loans with no credit check.
Types of No Credit Check Loans
There are numerous types of no-credit-check loans, so the choices available to you depend on the platform or lending institution. That said, below are the most common types:
- Payday loans
This is borrowed money that is repayable with the borrower’s next paycheck. Payday loans are short-term and often involve small amounts since they are paid back with a single paycheck. They are meant to bridge the gap to your next salary, so they are usually due in 2 to 4 weeks. Payday loans have high-interest rates.
- Title loans
Also known as car title loans, they are secured loans that rely on your motor vehicle title as collateral. The amount you receive from a car title loan depends on the vehicle’s value. Fortunately, most lenders allow you to keep driving the car as you service the loan. Defaulting results in repossession.
- Installment loans
This refers to loans repaid in fixed-periodical payments or installments rather than in a lump sum. These payments are often made monthly, and the dates are predetermined before the loan is approved. You can borrow more money with installment funds than with other no-credit-check loans.
- Personal loans
Personal loans online mean unsecured borrowed money used to cater to individual expenses. These can include holiday trips, investments, or car repairs. You can repay personal loans in lump sum or regular/irregular installments, depending on your agreement with the lender. They tend to attract high-interest rates.
How to Get No Credit Check Loans Online
As seen above, getting no credit check funds is a hassle-free exercise. Below is the list of steps you need to take to complete a loan application and get your money:
- Find a reputable lender
There are multiple online lenders, but some are malicious and will steal your information or give you unfavorable terms. Thus, begin by looking for a reputable lender, such as those found on iPaydayLoans.
iPaydayLoans is a genuine, web-based loans brokerage platform that connects borrowers and lenders. The page hosts 100+ no-credit-check lenders that borrowers can reach by visiting the website. It is free to use and offers the most competitive interest rates. If you need online loans funds urgently, check it out now.
- Fill out an application
Once you identify a suitable lender, fill out the application form on their page. You need to provide basic personal and financial information such as an address, SSN, bank account number, and work details. Simply follow the onscreen prompts.
- Provide necessary documentation online
Some lenders, especially those offering secured and substantive loan amounts, may require you to upload some documents. These can include the car title or other identification documents. Hence, before beginning the application, find out which documents are required so you can have them ready.
- Wait for approval and get funded
After submitting your loan request, the lender reviews your application and presents a loan offer. If you use iPaydayLoans, you will receive various loan quotes from multiple lenders within minutes. This gives more options to select from.
Upon accepting a loan offer, the creditor deposits your money as soon as possible. If the lender is reputable and efficient, you can receive the money on the same day you make an application.
Pros and Cons of No Credit Check Loans
No credit check loans are a welcome relief when you are short of funds, but they also have a downside. The following is a list of their advantages and disadvantages.
Pros
- Quick application
No-credit-check-loans usually feature a paperless, online based application process that is easy to complete. You only need a few minutes to fill out the online form.
- Financial relief
They offer direly needed financial assistance and allow you to handle your expenses. No-credit-check-loans can be life-saving when used for medical emergencies.
- Minimal requirements
The lenders only require a borrower to meet simple eligibility requirements such as being an adult, having a checking account, and having a valid form of identification.
- Fast approval
You do not need to wait for several days or weeks to know the loan decision. Lenders of these loans get back to you within minutes or hours after application.
- Near instant funding
Usually, these funds are made available to you within 24 hours after application or the next business day. Quick funding is convenient.
Cons
- High-interest rates
Since no-credit-check-loans are deemed high risk, they attract very high-interest rates. Some have an APR of 300 or 400.
- Exploitative terms
Some lenders take advantage of the borrower’s financial situation to impose abusive loan terms. These include hidden charges and forceful loan collection tactics.
- Risk of a debt trap
High-interest rates coupled with a short repayment period increase the chances of defaulting and rollovers. This cycle can leave a borrower trapped in debt.
Alternatives to No Credit Check Loans
No credit check loans should be treated as a last result since they are expensive. Before borrowing such money, consider the following options:
- Secured loans
Secured loans refer to borrowed money given with the condition that the user leverages an asset as collateral. This could be a house, car, land or other entity the borrower owns. They are a suitable alternative because they have a lower interest rate and more favorable terms. It is easier to acquire a secured loan than an unsecured one.
- Cosigned loans
This is a type of loan where a person, who is not the borrower, promises to pay off a loan in case the borrower defaults. Cosigned loans are popular with people who don’t qualify for funds due to poor credit or lack of a stable source of income. Cosigning can also enable a debtor to access more money or get better loan terms.
- Credit counseling
Credit counseling is not necessarily an alternative. Rather, it is a process that seeks to help borrowers settle their debts. It achieves this by offering them financial education and budgeting skills using various tools. Credit counseling mainly targets debtors struggling with debt or trapped in a debt cycle.
Many credit counselors go as far as negotiating with the lender on the borrower’s behalf. This sometimes leads to reduced interest rates and a waiver of late fees. Also, most credit counseling services are non-profit, and the sessions typically last an hour.
Conclusion
With that, you can successfully access an online loan with no credit check. This article has shown how and where to apply and the upside and downsides of taking out an online loan. Remember, iPaydayLoans is the go-to platform for reputable lenders.
However, all types of loans come with considerable risk, so you should only borrow what you need and only when it’s necessary. Before opting for a loan, try asking for help from friends or family. If you must take a loan, carefully evaluate the lender and loan terms.
