Get a No Credit Check Personal Loan

When it comes to borrowing, each personal situation is different, and every borrower has his or her own needs for securing personal loans for various uses. Many consumers with less than stellar credit scores might face more difficulty getting approved, but various kinds of personal loans exist that don't require a credit check or FICO score assessment. Although these no-credit-check personal loans will likely have higher interest rates, lenders are offering them because they realize that for many families, it can be hard to prove sufficient credit worthiness, especially in bad economic times. Follow these guidelines to help you get an affordable, no-credit-check personal loan.

Steps

Finding the Right Lender

  1. Find a willing traditional lender. Not every bank or lender is in the business of offering personal loans without credit checks. Start by calling the local bank or credit union you normally do business with and if they don't offer this type of loan, expand your search to other banks in your area.
    • Compare the interest rate offered on personal loans without credit checks. You may be able to find what appears to be a high-interest conventional loan, until you compare it to the interest rates on payday loans, cash advances, and title loans.
    • Lower interest means less money out of your pocket over the term of the loan.
  2. Evaluate costs and fees. Many lenders charge significant fees for putting through personal loans without credit check requirements. Loan origination and other items may show up on your overall personal loan, folded into monthly payments. Look out for excessive fees and don't be afraid to walk away from deals that seem too expensive.
  3. Consider micro lending. You may be able to use internet micro lending services (also called peer to peer lending) to help you find loans for amounts under $35,000. They may do a credit check, but this is only to set interest rates, not to disqualify you.[1]
    • Popular micro lending sites include Kiva, Prosper and Lending Club.
  4. Investigate a pawn shop loan. If you have anything of value such as jewelry, electronics, artwork, etc., you can bring it to a pawn shop and they will give you cash for what they believe it is worth. The merchandise is held for a specific period of time, and if you don't repay the loan on time they will sell it.

Evaluating Payday/Cash Advance Loans

  1. Consider a payday or cash advance loan. These are names for the same type of short term loan for smaller amounts that used to be tied to a borrower's next paycheck. They are offered to help with an immediate financial need but are small enough to pay back in a week or month's time in a single payment.[2]
    • You can do an Internet search under "payday loans" or "cash advance loans" and you will have many to choose from. You will need to provide your bank's routing and account number when you accept the loan, and the amount borrowed will be deducted directly from your checking account on the due date.
    • Average fees for these types of loans range from $15 to $40 for every $100 borrowed up to $500. Fees may be less on loans larger than $500. While expensive, it may be less than what you would pay for bouncing a check, paying a credit card bill late, or having your heat or electricity disconnected.
  2. Research lenders thoroughly. Thanks to our recent financially-troubled times, many otherwise responsible people have fallen on hard times, and their credit has suffered as a result. To address this market, dozens—if not hundreds—of lenders have jumped in, hoping to capitalize on people in need. Not all of them are scrupulous, so here are some things to look for:
    • Are they direct lenders, or a third-party lender? Third-party lenders will refer you to a direct seller, but you have no control where your personal information—such as your Social Security number—is being sent. Verify that they do not resell personal information, and anything transmitted is done over secure lines.
    • What do they offer? What are the minimum and maximum dollar amounts they offer for loans? The average provider offers online loans ranging from $100 to $1,500, though frequently they'll advertise a much higher number.
    • What is the interest rate? This will vary, and can be a flat fee, or a sliding scale based on the duration of your loan. What is their maximum term of the loan? Some are no more than 10 days, while some can be up to 6 months. The longer the term, the more expensive the loan will be—over 600% is not uncommon.
  3. Apply online. Once you have investigated the potential lenders, visit their website and fill in the required forms and provide any requested documentation. They will be looking for the following pieces of information about you:
    • Do you currently have a job? They will want to see proof of employment.
    • Monthly take-home pay—after taxes
    • Social Security number
    • Driver's license
    • Valid checking account
    • Valid email address
    • Proof that you're over 18
    • Credit checks may take place, though rather than using them to disqualify you, they will use them to set rates. In some cases, you may be disqualified if you have a bankruptcy on record.
    • If you are a repeat customer with a history of paying back in a timely manner, you may be able to get a lower interest rate.
  4. Collect your money. Most services will offer direct deposit within 24 hours, to your bank account. This is fast and convenient, and is a secure way to proceed—after you've verified that they are a legitimate company. Do not offer your bank account information until you have checked them out, as they will be able to withdraw money as well as deposit it.
    • You can find out if there have been problems reported on the lender from the Better Business Bureau or your state's attorney general's office.[3]

Evaluating Title Loans

  1. Consider a title loan on your car. Title loans trade ownership of your car's title for cash. Often, you'll have to turn over a set of keys in addition to the title. If you don't pay back the loan, you lose your car. Rates are comparable to payday loans, but because the loan is secured with your vehicle, you can often get much more cash and longer terms with title loans.[4]
  2. Apply online. Do an internet search on "title loans" and there will be many to choose from in your area. There will be fees and interest charged in addition to your providing the car's title. Generally the forms are quick and easy to fill out, and they will look for the following information:
    • Your car. They will want to know what your car is worth, so will ask for the make, model, and mileage. Based on this, they will determine the maximum amount you can borrow.
    • Your personal information. This is the standard stuff—the who, what, and where about you so that they can verify you're a legitimate person.
    • Finally, they will ask about your vehicle, your financial situation, and the best part—how you want to get your cash.
    • As you will see, the interest rates can vary dramatically. But if you can pay off the loan within a year or less, the rates can be closer to what you would pay for interest on a credit card.
  3. Make a payment plan. It's important to be able to pay off your loan on time. Take a look at all of the costs and combine them into a workable loan structure with your budget that can be paid off over the agreed upon time frame.

Assessing Your Current Finances

  1. Obtain a copy of your credit report and score. These can be obtained once per year from each of the three credit bureaus: TransUnion, Experian and Equifax. Their contact information can be obtained online at their websites or from the Credit Info Center.[5]
    • Your credit history is free but you may have to pay a small cost to get your actual credit score. Some banks, credit unions, and credit cards offer credit score information to their customers for free. In addition, firms like Credit Karma and Credit Sesame provide free credit scores.
    • Before going ahead with a no-credit-check personal loan, take a look at your credit score and see if you can benefit from a conventional loan with a lower interest rate. Lenders often charge higher interest for a loan without the lower risk involved in a solid credit score.
    • Correct any errors on your credit report with the store, bank, etc. who originally reported the information. This could help to raise your credit score and qualify you for a conventional loan.
    • You're considered to be a poor risk if you have a credit score under 620.[6]
  2. Calculate your income and assets. For many kinds of personal loans that don't require credit checks, having assets, collateral or other means of proving the ability to repay will help to lower interest rates for your personal loans and help your loan applications go through. Assets and collateral include your house, artwork, a car, valuable stamps and coins, and jewelry.
    • Type up your sources of annual income and your list of assets to present to potential lenders. Include any alimony, child support or social security benefits. Make a copy of last year's tax return as well.
  3. Ask about provisions for the self-employed. Many lenders offer less restricted personal loans tailored for self-employed individuals who are less able to prove income. These kinds of choices can also be solutions for people with slightly bad credit or need personal loans extended on other terms. Prepare a list of income received during the past three years and be ready to present three years of tax returns as well.

Related Articles

Sources and Citations

  1. ↑ http://www.businessinsider.com/how-to-choose-the-best-peer-to-peer-lending-site-2011-3
  2. ↑ https://www.cashnetusa.com/paydayloans.html
  3. ↑ https://www.bbb.org/
  4. ↑ https://www.consumer.gov/articles/1013-car-title-loans
  5. ↑ http://www.creditinfocenter.com/creditreports/CreditBureauContactInfohtm.shtml
  6. ↑ http://www.howcast.com/videos/125631-How-To-Strengthen-Your-Credit-Score
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