A quick Google search will reveal how common it is to find online unsecured personal loans for bad credit and that require no credit check. Some, however, who might otherwise jump at the chance for such a loan, often hesitate, wondering how quick loans no credit check can really be possible?
“After all,” the reasoning might go, “if credit checks are required by one lender, why wouldn’t they be required by all?”
Below, we introduce you to a few of the most important reasons why loans with no credit check are approved by many online lenders:
1. Many Lenders Accept Bad Credit
One way of looking at it is that if a lender is already agreeable to accept borrowers with no or low credit ratings, there really is little reason for that lender to even bother running the credit check. Many personal loans available online require no collateral and do not base approval on credit history, so a credit check would be superfluous.
2. Approval Is Based on Ability to Re-pay
Instead of a credit check, these lenders will base approval largely on the fact that you have a current, reasonably reliable source of income and make enough that you can be expected to make your installment payments on time. Other than that, they will require only basic things like a U.S. bank account and being over the age of 18.
3. For Quick Loans No Credit Check is a Necessity
Online lenders utilize the Internet to provide borrowers with cash in their account with minimal delay and complication from filling out forms and waiting for approval. Approval is often instantaneous and the request will take but a few minutes. A credit check would needlessly slow down the process and risk losing customers.
4. Lenders Take a Calculated Risk
Online unsecured personal loans provide fast cash and easy approval to many who can’t get a bank loan or don’t have time to wait for one to process. Fees and rates will be higher than for most bank loans, though lower than for payday loans and many credit cards. Lenders forego a credit check because they believe most borrowers will repay and, overall, they will make money rather than lose it.
5. Non-traditional Lenders Are Involved
Many online personal loans are loaned out by private or non-traditional lenders. This means they are not subject to all of the legal, financial regulations that banks must follow. They are thus free to lend to those with bad credit if they think the endeavor will be worthwhile.
Thus, quick loans no credit check are viable on the lender side of the equation; and they provide a valuable service for those with bad or no credit. Quick loans, no credit check needed, help you get fast cash that helps you through a “financial bottleneck.” So long as you have the income necessary to repay the loan fairly quickly after the emergency passes, such loans are a helpful tool.