Getting loans with poor credit scores although is difficult but not impossible, with many lenders offering unsecured personal loans with no credit checks. A loan for customer with poor credit ratings is a huge risk for the lender as the chances of another default are high. They justify this by offering only small amount of loans with heavy interest rates. Every lender has their own terms and conditions for such type of loans. To get such loans, one has to fulfill certain criteria of age, citizenship, reliable source of income which should be large enough to cover the monthly repayment and a valid bank account among others.
A quick look on the facts
As far as loans are concerned, one must always consider the timeliness along with the source of the funds. Such type of loans are very fast to process because it does not involve checking of credit scores which is a time consuming process and one can avoid waiting around the news of rejection or approval. They also provide instant approval but with excessive processing fees. With such type of credit one cannot afford to be choosy and has limited options in terms of loan amount and repayment.
Many non-traditional lenders offers smaller loans as part of the pay day loan scheme which has to be repaid within a short period of time and mostly done through automatic withdrawals. Personal loans without credit checks are like installment loans .Although it is a short term loan but many online lenders approve long term loans with longer repayment schedule, but it comes with huge interest rates. A few lenders also charge late payment fees. One has to do a proper research and look at its various pros and cons .The odds of approval for such type of loan is more with credit unions when compared to traditional banks were the latter uses more stringent methods for any loan approval.
A loan should always be straight forward and simple. Advertisement gimmicks like payment holidays and cash backs can incur heavy costs on the client due to its hidden policies. Also it’s better to check the privacy policies to avoid leakage of your personal information.
Check for fixed interests
It’s always better to go with fixed interest rates as they are easy to understand and pay. Loans with Variable interests are better to avoid as it contains many hidden costs.
Loans are overheads which should at best be avoided. But if necessitated in case of unseen emergencies, one must always do a comparative analysis of what you stand to gain and what you stand to lose by availing such a loan. This is because unsecured personal loans although have its advantages is also high on risk. One must not end up in deeper financial trouble than before.