How Do You Get a Cash Loan Without a Credit Check

With the rising cost of living and limited income, most of the people today face cash shortage. This leads to frequent borrowing of loans some of which results in defaults, arrears etc. This situation leads to negative credit profile of the borrowers.

The worst problem of negative credit issue or in other term bad credit profile is the reluctance of lenders to offer you any loan.

However, owing to the tight economy in general, negative issues in credit profile have become extremely common. There are several people who now have a bad credit profile.

So can we really deny the facility of borrowing cash to a person who is in need but have a bad credit profile? No; no competitive and open market can afford to deny this basic right to any citizen, however bad credit profile he or she has. After all even these people face cash crisis and they need to be supported to meet their needs.

What are bad credit loans?

It is therefore lenders have now started offering loans to people with bad credit. While offering loans, lenders now do not differentiate among borrowers on the basis of their credit profile. These loans are commonly referred to as bad credit loans. But these are also known by many different names such as bad credit cash loans, cash loans without credit check, bad credit payday loans etc.

How do you get a cash loan without a credit check?

Normally when you apply for any loan, lenders ask you to submit various documents including your credit score. Your credit score is used to check your previous track record of borrowing loans, repaying the loans, timely repayment, defaults, arrears, bankruptcy etc.

In fact your credit score makes everything very clear. Lenders carry out verification of your credit profile to corroborate the information that you have provided in the application form with the findings of lender’s verification. So, based on the credit verification lenders decide whether to offer you any loan or not. In case of traditional loans, lenders normally reject your application if you have a poor credit profile.

However if you have a bad credit profile and you apply for a cash loan, now lenders offer you cash loan without any differentiation. So how lenders offer you lenders offer you a loan even when you have a bad credit profile? Lenders offer you a loan even when you have negative issues in your profile because they do not look at your credit history to decide your eligibility.

In other words, lenders do not carry out any credit check to decide your eligibility. Therefore however bad credit profile you have, you get cash loans from lenders.

In fact these loans are offered to you on the basis of your present needs and current financial status. Therefore lenders do not carry out any credit check to decide the eligibility before offering you this loan.

Special benefit

When you borrow a cash loan without a credit check, you get a hidden opportunity. This is the opportunity to repair your bad credit profile.

When you borrow cash loan despite your credit issues and repay this loan as per the terms of repayment, your profile improves and you can see the difference when you choose to borrow any loan the next time.

The flip side

However like any other loans, the cash loans without credit check also have a flip side. Lenders offer you cash loans despite your poor credit history. So you are a risky borrower. Also, you do not provide any collateral to get these loans. Therefore lenders do not have any assurance or security of getting their loan back. These factors make these loans quite risky which results in a high rate of interest.

Because these loans are risky, lenders also charge a high penalty on late payments and defaults.

Therefore you should borrow these loans only when you actually need it. Moreover before borrowing you must decide the amount that you need to meet your needs. You should not borrow more than that of your actual needs. You should also plan in advance about its repayment to repair your existing bad creditors profile.

What Makes a Logbook Loan More Suitable Than a Payday Loan

With the recent economic turmoil in the world, it’s little surprise that many people are struggling to find ways to get cash-in-hand quickly. For this, short-term loans have often fitted the bill perfectly.

But as many banks have also been hit by the recession, they are increasingly wary of lending to consumers. As a result individuals are forced to seek alternative means for a cash loan.

A market that cropped up to meet this need was the payday loan scheme. However, those that examine the terms and conditions of such loans carefully may in fact notice that a logbook loan is more suited to their needs, and comes with lower risks than a payday loan.

What is a Logbook Loan?

A logbook loan is a loan granted against your vehicle’s V5 document or “Logbook”. It is an easy method of loan as they do not check credit history. It is generally approved within a day and requires very less paperwork. Though it has a requirement, ie. the vehicle should be finance free and should not be more than 12 -13 years old. Still, it is considered as a better alternative to Payday Loans because of low interest rates and flexible repayment options.

Here’s a few reasons that a logbook loan may be the more suitable option:

1. Interest rates are significantly reduced.

Although payday loans may seem a quick-fix for cash in hand loan, many individuals fail to consider the high interest rates that such loans come with.

Payday loans can sometimes come with APRs topping 4,000%, leaving borrowers paying back a substantially larger sum than they originally borrowed. It does little to help your cash flow stabilize, which is what loans are intended to do! If you don’t repay it quickly, you may find yourself facing a potentially debilitating debt.

Logbook loans however, are secured against the worth of the borrower’s car, which generally means that the APRs are far less, meaning it’s a more manageable debt and easier to pay back.

2. Potential for larger sums in loans

While payday loans may hold an appeal in that they require virtually no collateral, leaving it as a no-strings attached type loan, if you already own a vehicle you have a high-value asset in your possession. This asset can be used to help obtain a logbook loan, which then in turn gives you access to a greater potential sum to loan.

Although it depends on the value of your vehicle, logbook lenders may offer loans ranging from £200 up to £25,000. It doesn’t matter if you are considered to be self-employed, or if you have a less than stellar credit record. Your car is generally the second most valuable asset you would own, and you can make that asset work harder for you in securing a log book loan.

3. Loan periods are more easily managed

Payday loans are designed to be a quick-fix, that is a short-term solution. What that means, is you’ll have to repay the loan within a relatively short period of time. If the borrower cannot secure the funds to repay the loan, the interest quickly builds up. This leaves borrowers at times forced to take out a second loan merely to repay the first loan!

Lenders offering logbook loans however, can set it up so that you can repay the debt over a far greater time period, anywhere from half a year up to three. In addition, borrowers can sort out a repayment plan to match their cash-flow needs, which guarantees you can pay back your debt in a timely and stress free fashion.