As digital lenders become more and more popular, there are now solutions for all borrowers, even those who have bad credit.
Online lenders can help you get the personal loan that you may need to cover repairs, school fees, textbooks or other expenses — without sky-high interest rates. We’ll guide you through your options and introduce you to MoneyLion’s no credit check loan options.
What’s a No Credit Check Loan?
As the name implies, a no credit check loan is a loan that you can get without a credit check. Most banks and other lenders require that you undergo a credit check before you get a loan.
Every individual bank has its own requirements for those who will qualify for a loan. If your score is too low, some lenders may see you as a “risky” borrower.
The definition of “bad” or “poor” credit varies by bank, but typically, anyone with a credit score below 580 has very poor credit. You might want to look for a no credit check loan if your score is below 580 and pay very close attention to the terms of your loan.
Most loans that don’t require a credit check are personal loans. A personal loan is money that you borrow from a bank, credit union or another type of lender that you pay back over time.
Unlike other types of loans (like student loans or mortgages) you can use a personal loan for almost anything you want. Need textbooks for an upcoming college class? You can use a personal loan for that. Want to tackle some bills? You can do it with a personal loan.
How Do They Work?
No credit check loans work much the same way as any other type of loan. After you know how much you want to borrow, you can begin looking for lenders that can fulfill your needs. Keep in mind that loans that don’t require credit checks often offer lower loan amounts than other types of personal loans.
Like most other types of loans, you pay your lender interest in exchange for giving you a loan. Lenders calculate interest in terms of a yearly payout amount called an annual percentage rate (APR).
The average loan has an interest rate between 8% and 36%, and you can expect to pay an interest rate that’s on the higher end of that scale if you choose a loan without a credit check. The best way to make sure that you’re getting the lowest rate possible for a no credit check loan is to compare a few options.
There’s one type of no credit check loan that you should never accept: a payday loan. Payday loans are predatory loans that have very short terms, which refers to the amount of time before the loan must be repaid in full. They often include very high interest rates that build daily. Payday loans also often have high fees.
Things to Look for in a No Credit Check Loan
Here are a few things to look for (and avoid) when you search for a no credit check loan.
Features of Good Loans
Affordable interest rates: When you shop for a loan, compare the interest rates of various lenders before you decide. Loans at 36% APR are usually considered high-interest loans. The best way to ensure that you’re getting the most affordable interest rate possible is to look into several lenders.
Clear terms: You shouldn’t choose a loan that attempts to hide its interest rate, payment methods or anything else. Look for a lender that clearly lays out when payments are due, how much you can get in a loan and what you’ll pay in interest.
Transparent fees: Some sketchy lenders pepper their loans with high or hidden fees. Make sure you understand any fees charged by the bank or lender issuing your loan by reading the terms of service.
Emphasis on credit reporting: You can use the payments on your loan to improve your score if you have bad credit. But not every loan provider reports your payments to all three credit monitoring bureaus.
Look for a bank or lender that reports your payments to at least one of the major credit reporting bureaus, ideally to all three. In other words, you can see your score improve over time as you pay your bills.
Red Flags to Watch Out For
Unfortunately, the phrase “no credit check loan” is heavily utilized by scammers and fraudsters. Smart consumers should be cautious if you want to find a no credit check loan that’s right for you. Keep an eye out for these red flags when you search for a loan.
High loan approvals: A bank or lender that approves you for a $20,000 loan without a credit check sounds like a dream — but you should be suspicious. Be very wary of lenders that promise you a huge loan with no credit check.
High APRs: A high interest rate can make it very difficult to pay back your loan. Payday loans always have high interest rates — sometimes up to 700% in annual interest.
This means that if you take out a $500 loan from a payday loan provider at 500% interest, your loan gains almost $7 in interest per day. Ideally, you should search for a loan with less than 30% APR.
High-pressure sales tactics: Legitimate banks won’t pressure you to sign on a loan without reading the terms of the contract. If you notice that a bank or other loan provider is offering you a loan but only if you sign right now, chances are that it’s a scam.
Loan providers that ask for a loan origination fee up front: A common personal loan scam involves a “bank” that offers you a loan with no credit check. But after you apply for a loan, the bank asks you to submit a hefty loan origination fee, or an “administrative fee,” before you get your funds.
Getting a No Credit Check Loan with MoneyLion
MoneyLion offers two types of instant credit: a low APR Credit Builder Loan and 0% APR Instacash cash advances up to $250. Here’s how to get started.
Step 1: Download the App
Go to the Google Play or Apple App store and download the MoneyLion app. Enter your phone number and input the verification code you receive to move onto the next step.
Step 2: Open Your Account
Open an account with MoneyLion to take advantage of cash advances. Opening an account is easy. First, enter some basic personal information, including your name, phone number, current address and Social Security number to open an account.
You’ll also need to prove your identity before you can open an account. A state driver’s license, passport, military ID or state-issued ID card are all valid forms of personal identification.
Step 3: Link Your Direct Deposit
Browse your options for accessing 0% APR Instacash advances. Two easy options are joining Credit Builder Plus or linking your direct deposit of $250 or more to your MoneyLion Checking account through your MoneyLion app by following the steps provided. Alternatively, you can log into your HR or employee website and set up direct deposit there.
Step 4: Get Your Money
Navigate to the “Finances” tab in the MoneyLion app and click on the “Instacash” button. Depending on the amount of money you have coming in for the next pay period or your MoneyLion membership type, you can borrow up to $250 with a MoneyLion Instacash cash advance. Select the amount that you need, confirm your transaction and see your cash instantly deposited into your account.
You may want to get a low APR Credit Builder Loan with your MoneyLion membership after you’ve taken advantage of a cash advance. Here’s how to get started.
Step 5: Become a MoneyLion Credit Builder Plus Member
Before you can get a low APR loan through MoneyLion, you’ll need to become a MoneyLion Credit Builder Plus member. Apply through the app and of course, you won’t have to submit to a credit check to get an approval. Approval takes just minutes.
Step 6: Submit a Loan Request
Once you’ve opened your Credit Builder Plus account with MoneyLion, you can get a loan at a low APR instantly. Just submit a request for a loan through the app and get up to $500 deposited in your account in seconds.
Getting the Loan You Need
By staying smart and persistent, you can get the loan you need without submitting to high APRs, a credit check or predatory payday loans.
The most important thing to remember when you shop for a loan without a credit check is to read more about your loan in detail. After you’ve found the right loan, remember to always make your minimum payments on time. This will help you avoid late penalties and will help improve your score over time.
Are you ready to get started on the path to a better credit score and a great loan? Seventy percent of MoneyLion members saw their credit scores rise with a MoneyLion Credit Builder Loan. With free credit tracking, low APR loans and no credit checks at any time, MoneyLion commits to helping you get back on your financial feet. Download the MoneyLion app and open your account today.
How Can I Prove Income?
MoneyLion uses deposits from your employer to determine your income. There is no need to upload a paystub or any other employment history.
How Much Money Can I Borrow?
Depending on how long you have had an active account, we can determine how much you are able to payback successfully. A Plus member can receive a $75 to $500 loan depending on their qualifications.
Once your loan has been a approved, a portion of the loan will be available immediately for use while the other portion remains in a Credit Reserve Account. This will help you borrow only what you need while the other part of the loan is secured gaining interest.
Will This Help Improve My Credit Score?
Absolutely! More than half our members raised their score by up to 27 points to their credit score in 60 days. Every time you make a payment, we report to all 3 major credit bureaus helping you build credit in a shorter amount of time.
Payment history makes up about 30% of your credit score so we’ll automatically deduct your loan payment ensuring you are always on time.
