Direct lending has made it convenient for people to borrow a small sum of money with ease. Banks and traditional mainstream lenders will not let you borrow a paltry sum like £100 or £500.

Even if your credit rating is not stellar, you can apply for an emergency loan from direct lenders. One of the best qualities of these loans is that you do not need to arrange a guarantor despite a poor credit score, nor do you have to put down collateral.

Applying for these loans is not a herculean task. Just provide your personal and financial details and submit the application form online. The lender will quickly assess your application and transfer money to your bank account. It means you can get money within the same day.

It hardly takes 24 hours to complete the process. No guarantor loans are small loans aimed at funding emergencies. As the name suggests, these loans do not require you to arrange a guarantor even if your credit score is not up to snuff.

There are various short-term loans that people think they are signed off on without a credit check, and no guarantor loans are one of them. Well, there are certainly a few loans that do not require a credit check, but it depends on the lenders’ criteria whether or not they will give the nod for no guarantor loans with no credit check.

Most of the small loans are a type of no guarantor loans

When you want to borrow money, you will see various types of loans being provided by many lenders, and that confuses you to decide which type of loan you should apply for that meets your needs.

All emergency loans have more or less the same features, but they are advertised under different kinds of names, perhaps, due to varying search inquiries. For instance, if someone is looking for a loan and has a poor credit report, they might look for a no-guarantor.

Since a search inquiry is generated with this term, lenders will target it to ensure their visibility in the online world. This is why you see various lenders selling the same kinds of loans under different names.

Small loans like payday loans, bad credit loans, cash loans, text loans and emergency loans are all no guarantor loans. Despite a bad credit rating, they all do not require you to arrange a guarantor.

No guarantor loans can or cannot be available with a no credit check facility

Loans without a guarantor are not the same as no-credit check loans. All small loans are known as no guarantor loans, but some of them require a credit check. Payday loans are also small loans that you take out to fund emergencies, but they do not involve a credit check, and therefore, you can say they are no-credit check loans.

Your lender will decide your repaying capacity based on your income. However, payday lenders do run soft inquiries. They are called no-credit check loans as they do not run hard inquiries. Soft inquiries do not leave search footprints on your credit report.

No guarantor loans are emergency loans that you cannot get approved without a credit check. Whether or not a lender specifies, they will peruse your credit report. A hard inquiry will show up on your credit file, and they will pull some credit points. However, this impact is temporary. Your score will bounce back as you pay off your debt.

No-credit check loans can be scams

A typical no-credit check loan is one that does not require any kind of a credit check, neither hard credit nor soft credit. No lender is permitted to loan you without running an affordability check, and a credit report perusal is part of it. Lenders cannot avoid this statutory requirement because no lender is above the law.

Therefore, even payday lenders make soft inquiries to take a look at your credit file. If a lender provides you with a loan that runs no credit check at all, you should beware of them. Such lenders might be scammers. You already have a bad credit score so they will charge higher interest rates.

Because a lender does not know an idea of your past payment behaviour, the interest rate will be even higher. No credit check loans are paid back in a very short period of time in full. It might be difficult for you to pay back the loan on time, and eventually, you will fall behind on payments. This will keep rolling over the loan, and soon you will find yourself stuck in a debt trap. No credit check loans are issued in order to trap bad credit borrowers to extortionate money.

Payday loans can be no-credit check loans

Some payday lenders do not run a credit check at all while lending money to bad credit borrowers. It means they run neither hard inquiries nor soft inquiries. The lending decision is made after taking into account your repaying capacity.

These loans are the same as no-credit check loans, and you should avoid payday loans from a lender who does not run a credit check at all to determine your eligibility. Borrow money from a lender who at least runs soft inquiries.

How can you get no guarantor loans with no credit checks at attractive interest rates?

Interest rates will be high if you are looking to apply for a no-guarantor loan with no credit check. A soft inquiry cannot let a lender know about your past payment behaviour, so you will be considered a borrower with a high default risk.

As a result, the interest rate will be even higher, and this may throw you into an endless circle of debt. Instead, you should apply for no-guarantor loans that involve a credit check. Here is how you can avail yourself of attractive interest rates:

Try not to have too bad credit score

A bad credit score range falls between 561 and 720. The lower the credit score, the higher the interest rate. However, if your credit score is above 600, you will likely find better interest rates. Further, if missed payments and defaults are older, you will have better chances of getting the loan at lower interest rates.

You should not owe any other debt

At the time of taking out a loan, you should ensure that you do not owe any other loan because this will raise a question on your repaying capacity. Thinking that you are likely to make a default, your lender will charge a higher interest rate.

The bottom line

All small loans that do not involve the requirement of a guarantor are called no guarantor loans, but some of them cannot be approved without a credit check, and if so, they involve a soft credit check.

Only payday loans are a type of no-guarantor loan that you can get the nod for without a credit check at all, but you should try to look for payday lenders who run a soft credit check. No credit check loans can be scammers. You should try to beware of them.