PERSONAL FINANCE BLOG

Money shouldn´t stop making your plans come true. Learn how personal loans can help you!
Loans without Credit
14 Jul 2018

Loans without Credit: Important Facts That You Should Know

If your credit rating is poor, you might be wondering how you will ever get a loan again. Well, there is one way, providing you do not want to borrow a huge sum of money, loans without check.

Just to be clear these types of loans are not suitable for anyone wishing to borrow a large amount of cash, as virtually no lender will give you a large credit sum without first checking your credit rating. There are some facts to be aware of when considering applying for a loan if your credit rating is poor and we look at them here.

What Type of Loan Is Available Without a Credit Report?

Lenders offering loans without credit generally offer what are called short-term loans. These are loans taken out over a shorter period, typically between one month and up to twelve months. The amount of money that may be borrowed on this type of loan is typically in the range of between £50 and £1,000 but will depend on the lender and your income. This type of loan may come in handy if you find yourself short of money over the short period on the odd occasion. The loans should never be considered for over the longer period.

The Interest Charge on Loans without Credit

All loans come with APR attached. This is the amount of interest paid on the loan annually. If your credit rating is poor, you can generally expect the interest rate to be typically higher than for those with good credit who have the pick of the best loans and low interest rates. On saying this, we work with lenders offering some of the best interest rates available for those with poor credit.

The longer you take out the loan the more interest you pay. Bear this in mind and only ask to borrow the money you really need and repay it on time.

Eligibility for a Short Term Loan

You will have to ensure you are eligible for applying for a short-term loan. The criteria may differ slightly between lenders, however, most will ask:

  • If you are over the age of 18;
  • You are a UK resident;
  • You have a bank account in the UK with a debit card attached;
  • You have a phone number in the UK.

Do Lenders Really Offer Loans Without Making a Credit Report?

As mentioned above the majority of lenders offering large loans over periods of years will not offer a loan without doing a credit report. However, the short-term loans can be offered without a full credit report.

Of course, the lender is going to want to make sure the loan is affordable, as you might have earned a bad credit rating before by not being able to meet the repayments of a loan or credit card.

While they may not undertake a full credit report, all lenders will generally look into your income and outgoings to ensure the loan is affordable. Here at Bonsai Finance, we work with many lenders who offer loans without undertaking a credit check. Our lenders specialise in offering loans to people whose credit rating is far from perfect. The lenders we work with generally take your income into account, not your credit rating, so they are more likely to approve a short-term loan. We can help to match you up with a lender who offers a suitable loan for your needs, which is affordable, without being swayed by your credit rating.

Always Read the Terms and Conditions

Always read the terms and conditions of any loan you are considering to ensure you know exactly how much you are borrowing, the rate of interest, the amount of interest and when it has to be paid back.

Loans without credit are a simpler and easier type of loan to apply for and get approval for when compared with other types of loans, but it will have terms and conditions. Some small term loans are paid back on your next payday in full, other lenders might allow you to take the loan out over a three month period or longer. Make sure you know how much the total loan is going to be and when it has to be paid in full.