How to Find "no credit loans"

No credit loans are those loans that do not require credit verification. It is not easy to obtain one as most reputable lenders require a proof a financial health. They want to make sure the borrower can afford to pay off the debt and not default on his/ her obligations.

Most people find it hard to establish credit history, especially the unemployed, military personnel on duty, and those who just graduated from college. Having no credit history is equal to bad credit and therefore, lenders charge higher interest rates.

To qualify for no credit loans, the borrower needs to be employed or have a regular source of income. It is easier to obtain a secured loan if you have a valuable item to serve as collateral. Even in this case, however, the lender may need additional guarantees that the borrower will not default. Cosigner may be required, and he/ she will be responsible for the repayment as well. If you ask a close person to become a cosigner, the creditor might check their credit history. Naturally, having a good credit history increases the chance of obtaining the loan. Another way to go about it, given the high interest rates that go with no credit loans, is to apply for a secured credit card and pay the balance on time.

When applying for the loan, the borrower will have to provide information such as income amount, employment history, current employer, and personal details. It is recommended to enclose a letter to the prospective creditor, detailing the reasons you were unable to establish credit history to this point. The lender will appreciate it. It is also important to asses your present financial situation. When you obtain a no credit loan, you should meet the monthly payments and cover other costs such as closing fees, lender fees, application fees, etc. Some creditors will offer a low interest rate, but the closing costs may be quite high. When comparing the offers of different creditors, ask them for a good faith estimate that will give you an idea of the loan’s total cost.

Another point to consider is whether the creditor is authorized to extend no credit loans. You might check their rating with the Better Business Bureau and make sure no complaints have been raised against them in the past.
One way to obtain no credit loans is to join your local credit union. Credit unions are built around the idea of serving people and extend loans under better terms. While they won’t take unnecessary risks, credit unions offer advice on the best ways to build credit. They can also offer a no credit loan provided that you have collateral and a steady income to pay off the loan.

As a last resort option, you may apply for a payday loan which is extended to anyone who can prove a regular source of income. Payday lenders usually target borrowers who have exhausted all other loan options. Given that few legal restrictions are in place on this type of lending, some payday companies charge exorbitant interest rates, leaving the borrower with no other option than applying for e new loan to pay off the old one. In general, even subprime lenders are to be preferred to payday companies. Make sure you understand the loan terms and never feel pressured to borrow.