Forty-five million Americans have no credit score at all. Of that group, 26 million have no credit history with the major credit reporting agencies at all, while 19 million have unscorable credit histories — meaning their history is too old or doesn’t offer enough information for a credit score.
To some, having bad credit might sound even worse than having no credit. But when you’re trying to get a loan, the two problems are one and the same. Whether you have bad credit or have never had a credit card at all, getting a loan can become very difficult.
That’s where a no credit check loan comes in. With a no credit check loan, you can get the funds you need without having to worry about your credit score (or lack thereof).
How can you get a no credit check loan? We’ll break it down step by step right here — keep reading to learn more!
What is a No Credit Check Loan?
A no credit check loan is a loan that doesn’t go through the typical credit check process. This speeds up the process a lot, so you won’t need to wait if you need money fast. And there’s also less paperwork involved, as well as no stress about what a credit check might reveal.
Traditionally, the “hard” credit check that’s done in order to get a loan hurts your credit score. If you already have a low credit score and are struggling to build it back up, you may not want to take the risk of losing points with a credit check.
And, of course, if the check reveals low or no credit at all, you probably won’t get approved for the loan. This makes credit check loans a lose-lose for many people. But with a no credit check loan, you’re much more likely to be able to get the funds you need.
Most no credit check loans involve a “soft” credit inquiry, which doesn’t affect your credit score. This helps the lender set the appropriate terms for you. They might also look into your income, financial history, and work status.
Who Needs a No Credit Check Loan?
No credit check loans are ideal for people who need money fast. The traditional loan approval possible can take days, sometimes even weeks. But when you need funds, you may not be able to afford to wait that long. Read this for more on how quick no credit check loans can be.
With a no credit loan, the lender takes a holistic look at your financial situation, rather than just going over your credit score. This lets them make a more accurate decision by looking at your ability to repay the loan, rather than just the number on your credit report.
If you need a loan and know you have the means to repay it, but don’t have a credit score that will get you there, no credit check loans are the way to go.
Where to Find No Credit Check Loans
To find a no credit check loan, start by looking for the right lenders for you. You’ll want to search terms like “personal loan no credit check,” and make sure to look for unsecured loan options.
Secured loans use collateral, like your car or house, to ensure the lender will get the value of the loan back if you can’t pay. But it’s not a good idea to put these things on the line if you don’t need to. With an unsecured loan, you won’t need to worry about losing anything valuable in the process.
Find a few lenders that look promising by searching online. Today, much of the loan process can often be done online, which saves you the time and effort of an in-person visit. Then, go over the application requirements from each of those lenders to see if you qualify for their loan options.
How to Apply for No Credit Loans
Once you have a list of possible lenders, how can you apply for your no credit check loan? Here’s the step-by-step application process.
1. Read the Instructions
Start by thoroughly looking over what’s required to apply. You don’t want to get your application rejected just because you forgot about a small, but important, detail.
2. Consider Local Lenders
As you choose which lender to get your loan from, it’s a good idea to look at what the lenders in your area have to offer. Credit unions in your area may offer the best terms for someone with low or no credit. Even small financial institutions can offer great personal loan options.
3. Gather Your Documentation
The process becomes easier if you gather all of your documentation before you begin. You’ll need identity information, banking information, and demonstration of your income or work history for most applications.
4. Complete Application
You should easily be able to complete your application in a matter of minutes because you already have everything you need.
5. Build Up Your Credit
Now, it’s time to start paying back your loan and also build up your credit.
Getting your first loan can often help boost your credit score. However, you’ll also want to keep working on that score so that future loans will be even easier to get. Make sure to make all of your payments on time, and consider making careful use of a credit card to get your credit score going up and up.
Which No Credit Check Loan is Right for You?
Choosing the right no credit check loan all depends on your unique needs.
For some people, a local credit union might offer the best loan terms, and be easy to visit for an in-person application. For others, the convenience of an online application might work better. However, what’s most important is that you get the funds you need when you need them.
As long as you use a trusted lender, a no credit check loan is a great way to start getting your financial health and credit score on track. However, even with a loan, you might still be living with a tight budget. To learn how to grow your budget, check out our guide to generating extra cash!