Securing Payday Loans Without having Credit Checks Would make a true Variance
Bad credit is never a good thing, but it’s not the death-knell to funding so many of us believe it is either. There are loan options available to people with even the worst credit scores. The fact that it is possible to get approval on some loans, like payday loans, with no credit checks ensures this is the case.
Bad credit scores are not debilitating, and actually enjoy only a fraction of the significance traditional lenders would have us believe. Income and a suitably low debt-to-income ratio are far more influential factors, and while guaranteed loan approval never really exists, visit website these loans are the closest to it.
Still, there is no such thing as free money, and there are clear compromises to accept before a payday loan can be secured. They may be the fastest and most accessible route to cash on the market, but they are also the most expensive.
What is a Payday Loan?
Getting a payday loan with no credit check is not the ground-breaking development it might seem. These loans have been available in one form or another for decades, and bad credit scores have never had any significance to them. This is because the loan is granted on the back of an upcoming paycheck.
The biggest advantage is that approval is very easy to attain. It is not exactly guaranteed loan approval, but all that is required is that the monthly income be sufficient to make the repayment in one lump sum. And the fact that credit histories are not checked out means that cash can be secured quickly in times of financial emergency.
However, the loan limit is set at $1,500 while the interest rate is very high (sometimes 35%). And since the term can be as short as just 2 weeks, the pressure to repay a payday loan can be extreme.
Why No Credit Check Works
Lenders never turn to bad credit ratings to decide the fate of a loan application. There are more pressing factors, and given that the recent economic developments have left many honest borrowers with poor ratings, they no longer give an accurate indication of the kind of risk involved in any loan deal. So, the approval of payday loans with no credit checks does make sense.
What is more, because these loans are so much more accessible, with practically guaranteed loan approval, a greater volume of loans is granted. So, ignoring credit histories makes good business sense.
With no credit checks, the focus of the approval process is correctly centered on the fairest criteria – income. So, despite the pressures involved in making repayments in such a short period of time, a payday loan is sometimes too good to be ignored by borrowers.
Article Source: http://EzineArticles.com/7296576