Loans serve many purposes in people’s lives and since the time that banking has existed, loans have not just been around but also evolved to be safer, quicker and of many kinds. Loans however are not always attainable for everyone. Apart from just being a settled adult, having a constant income and having all documentation that a loan may require, there’s also the credit history that matters.

Credit history today, is primary represented by scores (credit scores) which are maintained for each individual. When one applies for a loan, apart from this score, typically also the credit history is viewed as maintained by the organizations that provide the credit scoring.

There are some loans however, that can skip the credit check process and some that even stay unaffected by the credit score. These tend to be different types of short term personal loans.

Understanding why Short Terms Loans can Skip the Credit Check Process

The credit history and score are important risk indicators for a loan lending company, during a loan lending process. However, these are not the holy-grail for some types of loans. When you apply for a shorter term loan, what typically matters much more than the credit history is the current income and upcoming payments of outstanding debts. These are factors that the credit score and history cannot clearly indicate.

For this main reason, it is less practical to just consider the credit score and history for a loan lending decision.
Furthermore, it is known that the credit system and scoring is not a flawless process. Errors, inconsistencies and missed records are frequent. Since many years, over 30% of the US’s borrowers suffer from bad credit scores.

A combination of all these factors leave a window that’s fulfilled well by the No Credit Check short term loans.

Are these Loans Expensive?
Loans and any other debt product, get expensive with two factors:

1.Risk for the lender, and
2.Demand in the market.

Short term loans with a no credit check policy, are high risk loans for lenders to be offering and they are currently in a great demand too.

Since the lender is lending at a higher risk, the expected returns ought to be on the higher side too. The great demand allows for a higher cost, hence these loans tend to be amongst the higher expense loans products in the lending market.

Where to Find Such Loans?
Short term loans without credit checks available only through direct lenders that are non-bank entities. At the time of the writing of this article, banks in the US do not offer such loans.

These non-bank direct lender loans can be found through one of these three sources:

1.Online Direct Lenders: The safest amongst the four, dealing with an online direct lender for loans tends to beneficial for customers because of the immense competition as well as easy access to other customers’ reviews and experiences that one can find before making a decision to take a loan. CashAmericaToday is a prominent online direct lender which offers bad credit personal loans with guaranteed approvals and no credit checks.

2.Mortgage Brokers: These are third-party entities that operate independently and maintain a database of direct lenders. Many of the lenders working with good mortgage brokers could be offering No Credit Check Personal Loans and the brokers would be able to help with such offers. Due to a presence of a third party, there are chances that a loan would be more expensive, but many brokers tend to have a fairly safe mechanism to select reliable lenders and this is something that some borrowers find valuable.

3.Other Direct Lenders: Many direct lenders still operate their services through pawn shops and other physical stores or setups. Although the demand for their services are dwindling, there still exists a market that prefers the personal interaction and physical paperwork, etc. Some also run on the basis of relationships.

How to know that the Loan is Safe
Safety of loans is essentially seen in two ways:

1.Safe decision to borrow: A loan is only safe to borrow, if the borrower is sure to be able to repay it on time. When loans cannot be repaid on time, they tend to get more and more expensive. This however, applies much more strongly to a loan that’s skipping the credit check process, because the lender is skipping an indicator of loan repayment tendency of the borrower. Plus the loan being more expensive, any penalty on it is also bound to be more expensive.

2.Safe loan source: As discussed in the previous section, there are ways of knowing if your loan lender is reliable. This is essential because short term loans with no credit check are only offered by non-bank direct lenders and there are some fraudulent lenders and some non-genuine lenders out there in the market.

How to use Short Term No Credit Check Loans to Improve Credit Score

Short term no credit check loans can be used with careful calculation to improve credit score over time. Be informed however, that if not carefully calculated and meticulously done, such a plan can go sideways terribly.

People who get it right, may use one or a combination of these two steps/strategies:
1.Replace Conventional Loans with No Hard Credit Loans: For a limited duration of time, it can be beneficial to take loans when you need, that skip the Hard Credit Check. Hard Credit Checks are done by institutional lenders like banks and also some other lenders while processing a loan. Multiple loans and even enquiries are bound to drop your credit score. A No Hard Credit Check loan on the other hand, does not affect your credit health.

2. Maximize Limits and Reduce Usage: If you have an option to increase your revolving credit limits like the limit on your credit card, it makes it easier to use a smaller percentage of your limit. Not exceeding 30% of your credit limit over a period of time on such a product helps you improve the credit score. People working on this and in need to borrow money while these efforts are in progress, often opt for Bad Credit Loans from direct lenders, which are available irrespective of the credit score.

Alternates to Loans

People in an urgent need of money, at times can use other ways to borrow or generate money to fulfil the needs that they may be looking at short term personal loans for. The four most common ways are:

1.Borrowing from Family/Friends
It comes probably without a question that this practice is fairly common despite the way it potentially and commonly affects relationships and/or a person’s ego. Borrowing for friends and family members may not be very reliable or healthy for relationships, but the advantage borrowers tend to find is that it doesn’t usually cost money to borrow – typically most friends and family members do not impose interest on the borrowed amount. However, if numbers are to believed, this trend is reducing perhaps because loans are becoming easier and more readily available.

2.Online Paid Tasks
Have you ever heard of Field Agent, Foap, Fiverr and other such platforms/apps where you complete tasks that suit you and earn out of them? Some tasks on some of these platforms do actually pay fair amounts quite quickly but understanding those takes much more than a day, which is why such services make sense for mainly those who have been using them for quite a while. Data says that one can expect to earn roughly $60-90 in a day’s work.

3.Lending Apps
Here’s an option where caution is of utmost importance. Borrowing from lending apps can be fairly quick at times but since it’s all on the small screen of the phone, it’s known that many people tend to overlook the fine print and that’s what makes people often end up agreeing to some very expensive terms and conditions. Nonetheless, the convenience of such a service had made it popular during the introductory days.

4.Conventional Paid Tasks
Provided that one knows where to find these tasks readily, tasks like pet sitting, babysitting, delivery jobs, cleaning jobs and other such tasks can be a useful solution to an urgent need of money.

However, if a personal loan is what you are looking for, CashAmericaToday has ideal options to suit most needs and you could follow this link if you need money now.

Author's Bio: 

Novlik is an independent Commodities trader with 7 years of activity in the international market. Having traded futures of commodities and other markets including debt and forex, he felt the need to study the Finance industry closely and from the roots. He believes that the knowledge that can be gained in such a way, can differ significantly from what is taught in schools and universities. This drove him into being passionate about expressing and sharing his knowledge about various topics that he believes he may have learnt nuances of, that a course like an MBA might overlook quite easily.