If you have bad credit, you may face challenges when it comes to qualifying for a personal loan. Because most lenders will check your credit score, it can be tough to convince a bank or credit union to take you on.
Some lenders offer no credit check personal loans, which means your credit score won’t hold you back from getting approved. Because these loans can come loaded with fees and high-interest rates, however, it’s important to do your homework before signing up.
The Best Online Short-Term Loans for Bad Credit
If you’re looking for a no-credit-check loan, it’s important to be wary of scams. Unfortunately, many lenders that offer quick cash with no credit check prey on people with poor credit scores.
Because a no-credit-check loan doesn’t take your credit score into account, the majority of lenders that offer these types of loans charge a high annual percentage rate (APR) to mitigate their risk. In some cases, the interest rates are extremely high, putting borrowers at risk of defaulting if they can’t afford the fees, finance charges, and exorbitant APR.
However, it’s possible to find a reputable lender that offers online personal loans with no credit check. If you’re searching for a loan with no credit check, here are four online lenders to consider.
1. Oportun
Oportun offers personal installment loans ranging from $300 to $8,000 with no credit check required. In many cases, borrowers can receive their funds within 24 hours, and some borrowers can get their money in as little as two hours.
Like other lenders that offer no credit check loans, Oportun charges high-interest rates. However, its rates are lower than those you’ll find at payday or title loan lenders.
Oportun also offers more generous repayment terms compared to payday and title loan lenders. Borrowers who take out a personal loan with Oportun can choose repayment terms ranging from six to 46 months.
On the downside, Oportun only operates in 12 states. While anyone can apply online, you must live in one of the 12 states to do business with Oportun.
If you’re interested in an Oportun loan, you can get prequalified online. You can also move forward with a loan application without worrying about it affecting your credit score.
Oportun requires the following information for a loan application:
- Photo ID or another form of personal identification
- Proof of income (bank statement or paystub)
- Verification of address
- Up to four personal references, which can include family, friends, and employers
While Oportun’s interest rates are high, it offers a number of borrower benefits. For example, you can choose a payment date that fits your budget and schedule.
Borrowers can also use a co-signer to help lower their APR. Oportun also reports payment activity to Experian and TransUnion, which can help improve your credit score.
2. OppLoans
OppLoans is transparent about its interest rates, which can go as high as 199% depending on the borrower. However, this is considerably lower than the interest rate for a typical payday loan, which can reach 600% or higher in states that don’t have payday loan legislation.
OppLoans takes this transparency one step further by posting the rates and terms for loans in every state it serves right on its website. This is a refreshing feature, as most no-credit-check lenders require you to go all the way through the application process before revealing their rates.
However, OppLoans isn’t without drawbacks. While it won’t check your FICO credit score, it does use a data gathering firm called Clarity Services to get your score.
This means that applying for a personal loan with OppLoans won’t affect your FICO credit score. On the other hand, OppLoans may take your score into account when determining what kind of interest rate to offer you.
OppLoans also has relatively short repayment terms, capping its loans at 24 months. Depending on your creditworthiness, you can borrow anywhere from $500 to $5,000.
If you’re interested in pursuing a personal loan from OppLoans, you can submit an application online. To apply, you’ll need to meet the following requirements:
- Earn at least $1,500 per month
- Must be employed or receiving benefits such as Social Security
- Must receive paychecks through direct deposit
- No self-employed borrowers
- Must have a bank account
OppLoans operates in 13 states and services loans in an additional 24 states with its lending partners, FinWise Bank and First Electronic Bank. OppLoans reports to all three major credit bureaus, so you can use your loan to boost your credit score by making your payments on time each month.
3. Capital Good Fund
Capital Good Fund only offers personal loans in Rhode Island, Florida, Massachusetts, Delaware, and Illinois. If you’re located in one of these states, however, you can get a personal loan without a credit check.
As a nonprofit lender, Capital Good Fund is a bit different than other no-credit-check lenders. The company caps its interest rates at 24%, making it much more affordable than its competitors.
In most cases, Capital Good Fund lends money to people who have encountered an emergency situation. For example, it offers specific loans to people who need money to weatherize their homes or pay unexpected medical bills.
Capital Good Fund also has a specific loan for people who need funds for immigration. The majority of loans offered by the company don’t require closing fees or a down payment.
To qualify for a loan, borrowers must have a bank account or a prepaid card from an approved provider. Borrowers must also submit the following documents:
- Two months of bank statements or statements generated from a prepaid card provider
- Personal identification
- Voided check or prepaid card with ACH features
- Proof of the reason for the loan (copies of bills, a note from an auto mechanic, etc.)
If you meet the requirements for a Capital Good Fund loan and you live in one of the five states it serves, you can apply online. Loan amounts range from $300 to $25,000.
4. Rise
Rise is an online-only lender that offers personal installment loans in 31 states. Interest rates can go as high as 299%, so it’s important to keep that in mind before you apply.
Depending on where you live, your APR with a loan from Rise can vary from 50% all the way up to 299%. To evaluate a borrower’s eligibility, Rise compiles an internal “score” based on the individual’s income and a soft credit inquiry from TransUnion and Clarity Services.
While Rise says that checking your loan options won’t impact your FICO score, its website also says it “may obtain” info from Teletrack, which is a firm that conducts data reporting for high-risk lenders.
Borrowers can receive between $500 and $5,000 depending on their creditworthiness. To apply, you must have a regular source of income as well as a checking account.
On the plus side, Rise loans don’t include a prepayment penalty. This means you can pay off your loan early to avoid accumulating interest.
How Can I Get a Loan Without a Credit Check?
You can get a personal loan without a credit check, but the majority of lenders who offer these types of loans fall within the category of predatory lending. To avoid getting trapped in a high-interest loan, it’s critical to do your research.
Before you apply for a no-credit-check loan, know that even reputable lenders in this space charge very high interest. In many cases, it’s better to look for an alternative form of funding before taking on a high APR.
How Do “No Check Credit” Loans Work?
If you’re borrowing money from an online bank, credit union, or another lender, a no-credit-check loan works much the same as any other personal loan. The obvious main difference is that the lender won’t pull your credit report as a condition of giving you a loan.
Because these types of lenders work with people who have bad credit, however, they charge very high-interest rates. Generally, it’s best to exhaust all your options before signing on with a no-credit-check lender.
Finding the Best Online Installment Loans for Bad Credit
Bad credit can definitely narrow your options when it comes to finding an installment loan. However, there are still a number of online lenders willing to work with people who are rebuilding their credit.
If you’re on the hunt for an installment loan, looking online can be a great option, as this allows you to quickly compare lenders’ rates and terms. Here are a few things to watch out for as you start your search:
- Interest rates – Having bad credit means you’re not going to qualify for the best interest rates. This is why it’s important to compare rates between lenders. While some bad credit lenders offer affordable rates, lenders that give loans without a credit check charge some of the highest APRs in the industry. You could end up paying triple digits, so it’s important to make sure you can afford the interest before you take out a loan.
- Fees and penalties – Unfortunately, many lenders that work with borrowers with bad credit try to nickel and dime with hidden fees, high fees, and penalty fees. Keep an eye out for steep loan origination fees, late payment fees, and prepayment penalties.
- Repayment terms – Make sure you understand your options when it comes to repaying your loan. You’ll pay more in interest with a longer term, but a shorter repayment term might make your payments unmanageable.
- Consider a loan aggregator – Loan aggregators offer loans from a network of lenders. Most aggregators are free to use, and they’ll match you with lenders willing to work with people with your credit history and income. Most loan aggregators won’t do a hard credit pull, but you’ll probably end up with a hard pull if you move forward with a loan application from any particular lender.
The Best Credit Cards for Bad Credit
Because no credit check personal loans tend to come with high-interest rates, a credit card might be a better option. Generally, you’ll pay a much lower interest rate with a credit card, as state usury laws and federal regulations make it very difficult for banks to charge exorbitant interest rates.
Even with bad credit, you may be able to qualify for a secured credit card that gives you access to the credit you need. Here are three cards to consider.
1. Discover it® Secured Credit Card
The Discover it® Secured credit card comes with a 24.90% interest rate, which is considerably lower than you’ll pay with most no credit check personal loans. There is also no annual fee and no monthly service fee.
This credit card also comes with a rewards program that gives you 2% cashback up to $1,000 per quarter on fuel and food purchases, plus an unlimited 1% cash back on everything else.
Because it’s a secured credit card, you’ll need to put down $200 to open your account. However, this is a small price to pay for an interest rate you can live with.
2. Capital One® Secured Mastercard
The Capital One® Secured Mastercard is another secured credit card, but it gives you the option to deposit $49, $99, or $200. Regardless of how much you put down, you’ll get a $200 credit limit.
This might not seem like much, but you also get an opportunity to increase your credit limit after five months of on-time payments. With 26.99% interest, this is a good alternative to a payday loan or high-interest no credit check personal loan.
3. First National Bank of Omaha Secured Visa
One of the most common drawbacks of secured credit cards is they tend to come with a relatively low credit limit. The secured Visa from First National Bank of Omaha is a rare secured card that comes with a credit limit ranging between $300 and $5,000.
At 20.24% APR, this card’s interest rate is more reasonable than rates you’ll see with payday and no credit check personal loans. According to the bank’s website, you can increase your credit limit after seven months of regular payments, and you can get your security deposit back after 11 months.
No Credit Check Loans FAQs
Here are some of the most frequently asked questions and answers regarding no credit check loans.
Should I Avoid No Credit Check Loans?
For the most part, it’s best to avoid no credit check loans if possible. In fact, many no-credit-check lenders will tell you right on their websites that it’s a good idea to go with an alternative funding source if you can.
However, this isn’t always possible for everyone. If you’re truly in a pinch and need fast access to cash, a loan from a no-credit-check lender should be a last resort.
Where Can I Borrow Money ASAP?
In addition to no credit check personal loans, there are several options for getting funds fast. Each one has its own benefits and drawbacks, so it’s critical to research thoroughly before pursuing any form of lending.
- Pawn shops – If you have bad credit and want access to cash without a credit check, you can visit a pawn shop. To get a same-day payout, however, you’ll need to pawn something of value. This means you need to be willing to part — even temporarily — with an item you care about. To get your item back from the shop, you’ll need to pay back the money it loaned you, plus interest. Because pawn shops don’t run your credit, they tend to charge high-interest rates. Keep in mind that the shop will sell your property if you fail to repay your loan.
- Credit card cash advance – If you have a credit card, you could look into getting a cash advance. This can be a fast way to get money, as there’s no application process and no waiting for a decision. On the other hand, make sure you double-check your card issuer’s interest rate for cash advances, as they tend to be higher than the regular APR.
- Retirement accounts – If you have a retirement account, such as a 401(k), you might be able to borrow money from your retirement funds and then pay it back over time. The interest rates for these loans are low, as they’re not based on your credit score. Keep in mind, however, that borrowing from your retirement funds can be a somewhat risky strategy. For example, if you leave your job before the loan is repaid, you’ll have to pay it in full to avoid triggering rules that force you to pay taxes on the money you borrowed.
Which Apps Give Instant Loans?
If you’re in a hurry for money, there are a number of apps that let you borrow from yourself without paying the sky-high interest rates common with payday loans.
For example, Earnin lets you tap into a future paycheck, putting cash in your pocket before you get paid by your employer. Unlike a payday lender, however, it doesn’t charge you interest for doing so.
In fact, Earnin doesn’t charge any fees at all. To use the app, however, you must give it access to your bank account, as well as your geographical location data or an electronic timesheet.
Earnin allows you to borrow up to $500 against a future paycheck, but it might adjust this figure downward if it determines that you won’t have the funds to cover the loan.
There are several apps similar to Earnin. If you like the idea of using your smartphone to borrow from yourself, check out apps like MoneyLion, FlexWage, and Tapcheck.
Do No Credit Check Loans Affect Your Credit Score?
Because lenders that offer no credit check loans don’t pull your credit report when making a lending decision, a no credit check loan shouldn’t affect your credit score.
On the other hand, this type of loan will affect your score if you pay your bill late or default on the loan. This is why it’s important to be certain your budget can accommodate the interest and the monthly payment before you borrow.
Conclusion
Just because you have bad credit doesn’t mean you need to turn to a predatory lender to get a loan. If you’re strapped for cash and you’ve exhausted other forms of lending, a no credit check loan can be an option as long as you do your research and make sure you can afford the interest.
