If you need money in a pinch, there are a number of opportunities on the market today, regardless of your credit score. Many people today seeking a fast loan prefer no credit check loans to avoid having their credit score impacted through the application alone.
But what many may not realize is that a loan without a credit check can actually improve and even save your credit score. Some experts say that paying a loan like a no credit check loan back can improve your credit score by as many as 40 points.
Empower yourself with the information you need to use no credit check loans to save your credit rating.
What Are No Credit Check Loans?
A no credit check loan is a loan or amount of money that you apply to receive without having your credit score checked or your credit report accessed. Every time you apply to a lender that checks your credit, you get a note on your credit report that could impact your credit score.
But when you apply for a no credit check loan, this doesn’t happen. If you are applying for a no credit check loan where your payments are reported to the credit bureaus, then you can actually improve your credit score with them.
Types of No Credit Check Loans
The most common types of no credit check loans are payday loans. Approximately 12 million Americans take out payday loans every year.
But in some cases, a secured loan such as a secured credit card or auto financing can also occur with no credit check.
In the event of a secured no credit check loan, you will use something called collateral to secure the loan. A car, for example, could be considered collateral and would be taken from you if you couldn’t pay the loan back.
At the same time, a secured credit card could involve you adding a deposit at a bank and using that deposit as your secured credit line. But if you paid that bill off every month, you would, in turn, improve your credit score.
So although you may be on hard times now, a no credit check loan is not always a desperate measure. It could help you improve your credit rating.
Learn more about how no hard credit check loans are possible.
How Do Loans Improve Credit Scores?
Any type of loan is going to improve your credit score if you are able to keep up with your payments. Once you get behind in payments you run into some problems.
There are different factors that go into your overall credit score. Your payment history accounts for 35 percent of your score, and your overall balances comprise 30 percent of your credit score.
The length of your credit history works in your favor as well. If you are just applying for your first loan, you can’t show lenders that you have a history of good payments.
This constitutes about 15 percent of your overall credit score.
At the same time, new inquiries into your credit report make up approximately 10 percent of your credit score. The fewer inquiries, the less “credit hungry” you look like and are more amenable to lenders.
You also want to have a diverse amount of credit ranges on your credit report in terms of kinds of credit. A revolving account like a credit card or credit line is good, but loans and car financing situations also help your credit as well.
Why This is Important
None of this is important when you are seeking no credit check loans. But it’s good to know what makes up your credit score.
When you get that no credit check loan, you can use those factors to determine how you handle that loan. The sooner it is paid, the sooner your credit history is established and your credit score improves.
That information won’t be needed for today’s loan, but if you want to buy a house down the road, you’ll need that history for a mortgage. Have a look at what mortgage companies consider before granting you a loan.
Advantages of No Credit Check Loans
No credit check loans have a number of advantages to those stuck in a pinch. To start, they help you take care of some bills that are on top of your head.
You may be feeling underwater for a number of reasons. You may have already missed a mortgage payment or two, and need help before you lose your house.
Medical bills, job loss, car accidents, and life events can trigger a sudden expense that will put you even more underwater.
If those bills aren’t paid on time, you could suffer more life stress, and even see more dings on your credit report. Having a no credit check loan can be a quick and easy way to solve that problem.
Not only will you see some bills paid quickly, but paying off that loan could improve your credit score.
So no credit check loans offer a variety of advantages to those that are stuck in a pinch due to life’s big stresses. You can use them to take control of your credit, and your financial situation at the same time.
You are not alone. Millions of Americans are going through this very problem right now.
Take Control of Your Credit
There are so many things that can hit you financially and it generally happens when life is already in a tough spot. A job loss or sudden medical problem can turn a family upside down in a heartbeat.
In America, as many as 42 percent of cancer patients had to drain their entire life’s resources due to steep medical bills. Having financial difficulties on top of a serious illness or job loss is seriously impacting the quality of life of millions of Americans.
It can happen to anybody.
There are a number of ways that no credit check loans can save you in a dire financial situation and improve your quality of life at the same time. But they can also help you to take control of your credit score as well.
Applying for no credit check loans can help you to pay off those debts that are reported to the credit bureaus. With that, you will receive peace of mind at having bills paid, while having your credit score improved.
Discover how to get past 2018’s bad credit history problem, and begin improving your credit score today.