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unsecured personal loan
23 Dec 2016

Why An Unsecured Personal Loan With No Credit Check Is Possible

When you need cash fast for an unexpected emergency or to enable you to make an important one-time purchase without delay, you cannot necessarily afford to wait for days on end to secure a bank loan. Additionally, for many, their past financial woes continue to haunt them and make it difficult to be approved for a loan with many “traditional lenders.”

On the other hand, those with a reasonable solid present financial situation do not wish to pay the high interest rates of credit cards nor be restricted by the quick repayment requirements of payday loans. This is where a no-collateral, no-credit check personal loan will often be the most viable solution.

What Is an Unsecured Personal Loan?

Unsecured Personal Loans With No Credit Check Many online lenders offer “personal loans” with scheduled installment payments to those with bad credit. These loans can be taken out in higher amounts than payday loans (often up to $5,000 vs. $1,000). And because they can be repaid over a longer period of time, ranging from a few months to a few years, and be paid back piece by piece, they allow the borrower greater convenience for “medium-sized” loans.

Since a lender of an unsecured personal loan relies primarily on your current income level and ability to repay, there is no need to demand collateral. Lenders may charge higher interest rates if your loan is relatively large or has a long repayment period, but they also often allow you to pay down your balance before or along with interest (unlike many credit card companies).

Why Are Credit Checks Not Always Required With Personal Loans

While some lenders of unsecured personal loans may run a quick credit check, there are many such lenders who forego a credit check altogether. How can they take that kind of risk? There are solid reasons that motivate them to do this, including the following:

  • An unsecured personal loan relies on your current employment status, income level, and other signs of ability to repay rather than your credit history to determine loan approval.
  • Speed is of the utmost importance both to the borrowers of unsecured personal loans and to the lenders who compete to secure these borrowers.
  • It is common knowledge that many who have been caught financially unprepared in the past, due to a recession, job loss, lay off, or other passing crisis, are in fact “good credit risks” even if their official credit scores don’t say so.


There are many good reasons why lenders would be willing to lend to those with bad credit or with no credit. The same motivations can also lead some lenders to forego the credit check process altogether. One of the prime no-credit-check loan-types is an unsecured personal loan.