Getting a loan can be tricky, but even more so if you don’t want the lender to do a credit check on you. Maybe you’ve got bad credit or maybe you don’t want to take a hit on your credit score – either way, you’re going to find it more difficult to get a loan – but is it possible? Let’s get into it with the help of CreditNinja.com and find out!
Before You Start
So, before you start looking out there for loans and lenders that won’t require a credit check, it’s important to know that even though you can find some lenders out there willing to do business this way – they often have very high and outlandish interest rates.
You’d have to really consider carefully if you want to take out a loan for such a high interest rate. Do you have the financial capability to potentially keep up with such high repayments? Could you do anything financially if you fail to meet the payment requirements? These are the big questions that will need addressing before you formally make an application for the loan.
Be Sure To Check Your Credit Score
Before you accept any of the likely unfavorable interest rates, ensure you’ve checked your credit report. If you’ve never done so, you might have a happy surprise to see you’ve got a good score! If that’s the case, you’d be better off applying for a loan formally as normal with a credit check – because if you’ve got good credit, you’re much more likely to be accepted.
If you’ve never looked for your credit report before, the way you can do this is by going to the websites of three major credit bureaus; TransUnion, Equifax and Experian – or you can have all three with annualcreditreport.com. Each bureau will differ on their scoring system, but they’ll likely use similar methods in coming up with their report.
For example, the major things the credit bureau will take into account include missed payments, credit utilization ratio, previous payment history etc. If you’ve checked your credit report and you find an error there, it’s a good idea to try and get this rectified first and then recheck your credit report after it has been resolved. You may notice your credit score boosted and as a result, you may be better off applying for a credit-checked loan.
Loans Without Credit Check Requirements
Generally, people with little to no credit history or people with a poor history of credit management will look on the web for loans that don’t require a credit check. The thing is, there are often far better options for these people that don’t have a history of credit. For example, many credit card companies offer what’s known as a credit-builder credit card. These are a great way to build your credit over time so that you can formally apply for a loan and pass the credit check and get a favorable interest rate.
People with poor credit might have hit hard times, and may be trying to get a loan to help them out – but they should consider checking for debt consolidation loans first. Many lenders that offer debt consolidation loans set their credit score limits much lower due to the nature of its intent. Think about these options first.
Lenders that do not require a credit check generally get away with this because they will offer very high repayment interest rates or other terms that don’t help the borrower.
An example of this are payday loans. Payday loans may bypass the credit check but will demand a crazy amount of money back in return of their convenience. They may also require the payment back in full in quite a fast space of time, unlike your typical installment loans – which are much more favorable and do require a credit check.
If a lender isn’t asking for a credit check and their interest rate isn’t too high, they might request you to supply a co-signatory or for you to secure the loan against your home. Secured loans are very risky, as failure to meet the repayments can mean you’ll lose your home.
Summing It Up
It’s possible to get a loan without a credit check but you’ll find the terms very unfavorable. You’re better off trying to improve your credit score and negotiate better terms with other lenders when your credit score allows you to. Think carefully before applying for any loans!
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