Traditional loans have been a key player in providing financial aid for individuals needing money for decades. However, with online loans such as no credit check loans gradually shifting the landscape, you might be in a tough spot to choose between renowned traditional and comparative novice online lenders. You can learn more about it from Money Trumpet.co.uk
If that sounds like you, comparing the factors that differentiate both is a good headstart for making a decision. We’ve done that for you in this guide, so you can understand the two and make a sound decision. Meanwhile, you can find the best no credit check loans on WeLoans if you’re looking for one.
What are No Credit Check Loans?
Before we jump into comparing the two loan types, it’s crucial to understand what a no credit check loan is.
A no credit check loan is essentially a loan type featured recently by online lenders to extend financial aid to borrowers with bad credit scores. Lenders may still conduct a soft credit check to briefly go over the credit history, but that, too, has no primary influence on the application’s acceptance or rejection.
Traditional lenders, on the other hand, rarely, if ever, offer such loan types. If you’re opting for a traditional lender, you most likely will have to take the good-old personal loans, payday loans, investment loans, etc., path.
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No Credit Check Loans Vs. Traditional Loans – Pros and Cons
You can’t make a decision between the two unless you’re aware of the pros and cons of each loan type. Moving forward, we’ll discuss the primary factors that set these two loan types apart:
Finding the Right Lender
For traditional loans, you’ve to find a lender first and then apply. The search may take days to find a credible lender near you that’s offering a loan type you’re willing to apply for.
Alternatively, no credit check lenders are easily searchable online. A simple Google search is all it takes to access thousands of online lenders that don’t even have to be in your vicinity.
Plus, the biggest advantage of this aspect is finding multiple lenders through a loan broker, such as WeLoans, instead of having to spend time finalizing a single lender beforehand. This also enables you to compare multiple offers in one place before deciding.
Traditional lenders will almost always ask you to complete the application process by filling in the paperwork and submitting it at their branch. For this reason, the application process can become long and tedious, especially if you already have an exhausting schedule and need to make time for it.
Online lenders have set up a digital application process. It takes a few minutes to fill in the form and hit submit on the lender or broker’s website. Within minutes, the concerned party receives the information and duly acts upon it. However, for those who aren’t tech-savvy, while the form is straightforward, it may cause a few issues. Nonetheless, nothing too complex that you can’t get through with a little help.
Traditional lenders have set rules that decide the acceptance rates of loan applicants. Most traditional lenders require good credit scores, low debt-to-income, and minimum income to approve loan applications. If you already tick those factors, you may easily get a traditional loan.
Alternatively, most applicants don’t have that kind of profile. At this point, online lenders have high acceptance rates with minimum criteria. For starters, no credit check loans are tailored to bad credit score applicants. Additionally, online lenders don’t have stringent requirements and mostly require proof of your repayment ability.
Traditional lenders won’t skip the routine hard credit check on your credit report. Applying with a traditional lender means you need an existing credit score that won’t further depreciate with the lender’s required credit check.
Meanwhile, online lenders have foregone that requirement as well. They only conduct soft credit checks for no credit check applicants to have a general overlook of the applicant’s debt-to-income and previous history. Soft credit checks do not affect or bring current credit scores down further. They also don’t decide the applicant’s loan approval chances. Plus, where traditional lenders may consider not having a prior credit report as a negative point, online lenders wouldn’t reject you.
We have to hand this one to the traditional lenders. Customer support is almost always better when dealing with the lending company face-to-face. The overall experience is more personalized.
Online lenders are still working on their CSR departments. However, one benefit is that their online guides and FAQs are accessible 24/7. Some lenders have also put up 24/7 customer support chats that can help you out any time of the day.
Traditional lenders take their sweet time reviewing applications and sending an approval or rejection. This process may take days or weeks, depending on the lender’s policies, and the funding could take even more time to land in your bank account. Expect at least 1-2 weeks processing time for a traditional loan.
On the flip side, no credit check lenders understand the urgency of such loans. As a bonus point, since there’s no paperwork involved and the process is 100% online, it takes significantly less time to process no credit check applicants.
You can get an offer as well as approval in a matter of hours, or a few days at best. Most lenders can even approve the loan and deposit the funds as quickly as within 2-3 days.
How to Apply for a No Credit Check Loan Online?
If you’ve decided that a no credit check loan is the best route for your financial emergency, there’s nothing else left but to apply for one. Follow these step-by-step instructions to get there:
Go to the WeLoans Website
Visit the WeLoans website directly by typing it in the URL tab. On the website, navigate to no credit check loans and fill out the application form that opens once you click “get started”.
WeLoans connects you to a wide network of trusted lenders across the US. With multiple lenders on their radar, you’ll get to review offers and select one based on your requirements.
Wait for Your Loan
All that’s left is to give the lender time to approve your loan. Once that’s done, the funds hit your account in a few days.
Choosing between a traditional lender vs. a no credit check lender depends on your personal preferences. But, as far as the factors mentioned above go, we believe the latter overall takes the win. It’s important to consider the factors and your options carefully when borrowing money.