Can You Get Personal Loans With No Credit Check?
Is it possible to get personal loans with no credit check? If you want to take out a loan with a bank or similar financial institution, most of them will perform a credit check. In order to protect themselves from losing money to risky borrowers, banks will assess your financial history and look at your repayment history with credit cards and other loans. If you have been consistently unable to pay your bills on time, you may be denied for a loan. However, it is possible to get a personal loan with no credit check.
Who Offers Personal Loans with No Credit Check
If you believe that your bank will reject your loan application due to bad credit, you have a few other options to get personal loans with no credit check:
- Credit unions. Depending on where you live, where you go to school, or your occupation, you could be eligible to be a member of a credit union. These organizations will often give out personal loans with no credit check. Even if they find that you have a low credit score, these unions will often overlook this number in favor of examining your financial status as a whole. These loans also come with more flexible terms and lower interest rates than loans offered by other lenders.
- Online lenders. Getting a personal loan online is very appealing to borrowers because of its convenience. They can apply from home and typically get approved faster than they would at a bank. Instead of running credit checks, online lenders only have a few requirements for borrowers. These include having proof of income, an active bank account, and the ability to pay even just a small amount each month. Another option to find personal loans with no credit check.
- Auto title loans. If you have bad credit but own a car, you can get an auto title loan. The lender will give you the amount of money that your car is worth and you are expected to hand over the title of your car to them until the loan is paid back. Failure to do so could result in the lender seizing your vehicle. So even though these are personal loans with no credit check, you still need to put your car as collateral.
- Payday loans. Like online and auto title loans, getting a payday loan is a good way to get money quickly. However, they should always be your last resort. These loans are often very inflexible with repayment schedules and come with high interest rates. The average APR (annual percentage rate) of a payday loan is 400%, over ten times that of a loan from other lenders. Since this means more debt that you’ll have to repay, getting a payday loan can also damage your credit score even further.
Getting Personal Loans with No Credit Check from a Bank
While some people have had success using online lenders, a bank is generally the safest place where you can take out a loan. They will almost always run a credit check, but it may still be possible to get a personal loans with no credit check or at least with a poor credit rating.
- Work with your bank. When you fill out an application for a loan, there’s not really any space for you to supply additional information about your current financial standing. If you can work directly with a bank associate and show that you have other redeeming factors, such as proof of employment and recent on-time payments, you’re more likely to get approved for a loan.
- Have important documents ready. If you’re going to present your case on why you should be approved for a loan despite bad credit, you need to have evidence to show that you’ll be able to pay it back. You should be able to show your lender proof of income, bank statements, tax returns, and any documentation of repayment progress on past loans.
- Bring a co-signer. Financial institutions will feel more at ease with lending you money if someone with a good credit history is applying for the loan with you. If you miss a payment or default on the loan, the responsibility to pay it back will fall on the co-signer.
Risks of Getting Personal Loans with No Credit Check
Lenders determine your interest rate based on how likely you are to repay the loan. Customers with good credit will get the lowest interest rates since they pose the least risk. Alternative lenders such as online and payday loan companies may take advantage of this to assign their borrowers incredibly high interest rates. You should also research the lending company’s background thoroughly to make sure it’s not a scam. Scammers will often press you for additional bank account details and charge extra fees in order to get more money from you.
During an emergency, you may find yourself in a position where taking out a loan is the only option to keep yourself afloat. Bad credit is definitely something that you need to fix, but you can still get a personal loan with no credit check in the meantime. Successfully repaying the loan will also boost your credit rating so that you will have an easier time getting a loan in the future.