We do not want to be the one to burst your bubble but there is no such thing, as no credit check loan no guarantors. It is the law in the United Kingdom that all lenders have to check your credit rating before offering you a loan. There is such a thing as a no guarantor loan though, but the lender should check your credit rating before approving or denying the loan. This is a ruling set out to safeguard both the lender and yourself.
Why Do Lenders Make Credit Checks?
Credit checks have to be undertaken by all lenders as it is a way of finding out how likely you are to be able to repay a loan.
The lower your credit score, the less likely the lender is to offer you a loan as you are seen as a bigger risk in regards to repaying the money back. However, just because you have a poor credit rating it does not necessarily mean that you will be rejected.
What one lender thinks is too big a risk another might not, and be more inclined to give you a chance based on your current circumstances and ability to be able to repay the loan.
Credit Checks Are For the Good of the Borrower Too
Lenders make credit checks not only to safeguard themselves against a loss but also to protect the person requesting the loan. If someone takes out a loan and finds they cannot repay they are getting into even more financial difficulty and non-payment or late repayments are counted on their credit file.
By the lender checking your credit rating and determining your ability to repay, they are looking after themselves and you.
What Is A Credit File?
The lender will review your credit file; this is a collection of data giving a history of a person’s borrowing activity along with repayment activity. The credit file is what will go towards determining your credit score.
It is a good idea to keep a check on your own credit file and score and you can do this free of charge in many ways. These include Experian and ClearScore, among others.
The credit file includes information about you such as whether you are on the electoral roll, any other forms of credit you have, and how much you owe. Whether you have any CCJs against you, you have declared bankruptcy in the past, how many open accounts you have and whether or not you have been late with repayments or missed repayments in the past.
Credit agencies consider this information to determine your credit score. Generally the higher your credit score the better your chances are of obtaining a loan and getting a decent low rate of interest. The poorer your credit score is the harder it is to get approval for loans without a guarantor and the higher the rate of interest.
No Credit Check Loans No Guarantor Are Impossible To Find
As you can see from the above, it is not feasible to get a loan without the lender checking your credit score. On the other hand, it is possible to find a loan that does not require you to have a guarantor, even if you have a poor credit rating.
Loans that you might be able to apply for and receive approval for include:
- A short term loan;
- A personal loan;
- A payday loan.
None of the above loans requires that you have someone stand as your guarantor.
Guarantor loans are popular choices for loans for those who have a poor credit rating due to the fact that someone stands as guarantor on the loan. However, not everyone has someone they can ask or wants to put that responsibility on a close friend or family member. Asking someone to stand as a guarantor can lead to breakdowns of friendship if for one reason or another you find yourself unable to repay the loan. If this should occur, the loan falls into the hands of the guarantor and they are called upon to repay it.
Luckily, times have changed and the guarantor loan is not the only options available to those with a poor credit rating.
Short Term loan, Payday Loan Or Personal Loan – Which Is Most Suitable?
So, the main choices of loans if you do not want a guarantor loan are the short term loan, the payday loan, personal loan or the secured loan. So which of these might be the most suited to your needs?
If you need to borrow just a small amount of money, say between £100 and £500, you might be more suited to apply for a payday loan. With this loan, you can choose to repay it over one to three paydays. This means it is paid off in full fast.
If you want to borrow between £500 and £1,000 and repay up to one year you might apply for a short term loan.
If you need to borrow a larger sum of money and spread the cost of repayments for up to 36 months, you might want to consider a personal loan.
Avoid any lender who claims they can offer you no credit check loans no guarantor. All lenders in the UK have to check your credit file for their protection and yours. No ethical lender will offer you a loan if it is clear that you cannot reasonably afford the repayments. Just because you have a poor or bad credit rating, it does not mean you will not be able to be approved for a loan. We work with lenders who consider your current circumstances along with your ability to be able to pay, more than your credit rating. The lenders we work with offer competitive rates along with numerous options for loans, so why not apply today with a simple and fast application.