What are no credit check loans?
A no credit check loan is one that will lend to those that have a poor credit record. You credit record can be affected by lots of things and there will be certain things that will put off potential lenders and mean that they will be unlikely to lend to you. This could be that you have not borrowed money before so you cannot show that you can be trusted to make regular repayments, that you have had a partner that has not managed their money well, that you have missed repayments on loans in the past or that you are self-employed so have no regular income. There are lots of possible reasons why you might not be seen as a good prospect with regards to lending, some which may be justified, such as you not doing well financially in the past and some which seem less fair, such as you not being able to prove you could manage a loan due to lack of borrowing experience.
If you do have a poor credit report then this will mean that you will be limited in who you can borrow from. However, there are some lenders who will lend to those with a credit report that is less attractive. They are often called no credit check lenders because it used to be the case that they did not do a credit check. It is now UK law that they do a credit check but they will have lower standards with regards to who they will lend to. They will not reject so many applicants as they are set up to be able to lend to those with a poor credit record.
What types of no credit check loans are there?
There used to be limited types of no credit check loans but the marketplace is growing. The most well-known is probably a payday loan or as it is also called, a little loan. These will allow you to borrow a lump sum of money until you get paid when you will have to repay the money and interest. There are also log book loans where you will use your vehicle as collateral on a loan and therefore not need a good credit record. You may also find a guarantor loan available to you, where you can select a person who has a good credit score who will cover any payments that you cannot afford to make on a loan. You will also find instalment loans, which are similar to payday loans where you borrow a fairly small amount of money without the need for a good credit score, but rather than repaying it all in one go, you can spread the payments over a series of months to make it easier to manage.
Which no credit check loans are best for me?
Choosing which no credit check loans are best for you can be tricky. They do differ quite a bit though and that can help. It is worth thinking about whether you would rather be able to repay the loan in full quickly or whether you would rather be able to repay it over a few months which might make it easier to manage. If you need a larger amount of money then this could be a more manageable solution as well. If you need an even bigger sum then you may need a vehicle as collateral and take a log book loan or you may want to use a guarantor.
This is not a complete list and so it could be well worth doing some research yourself to find out more about what is available. Making sure that you are really clear about exactly what you want from a loan can be really helpful and then you will be able to make sure that what you choose will match up with this as closely as possible. It is worth noting that different lenders will work differently and so if you are researching one specific type on loan on a lenders page then ensure you look at others as well as you may find they do things slightly differently. It is important to identify these differences so that you can find the loan that matches as closely to what you are looking for as possible. It will take some time but it will be worth it when you manage to find what you need.