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Personal Loans or No Credit Check Loans: Which is Best?
When you want to borrow money, you may be stuck between two types of loans. There are your short term borrowing options or your long term options. So, do you need no credit check loans that you pay back on your next payday or do you need the long term personal loans? It is worth comparing them to find out which is the best option for you.
The benefit of personal loans is that you can take out the money for a longer period of time. This means that you can usually borrow much more and is a great option when you have a lot of debts to take care of or want to make changes to your home. However, the no credit check loans are designed for the month and they offer the best options when it comes to affording an emergency payment or because you are simply running out of money by the end of the month.
As you can read, no credit check loans do not do a credit check on you; you can get the money even if you have an exceptionally bad credit rating. All the lenders want to know is that you have the current financial capabilities to pay the money back the next month. With a long term loan, the lenders will do a credit check because of the amount and nature of the loan. They will be less willing to loan to someone who has defaulted on payments in the past and are overstretching their budget.
The problem with long term loans is that you need to say why you want the money; this could be for a wedding or to consolidation debts. This reason will be added to your credit report and could affect it. However, no credit check loans do not need a reason and you can spend the money on whatever you need to; this could be a broken boiler or for your MOT.
However, the amount of money that you can take out on the no credit check loans is usually low. This is just because the loans are for the short term and you will need to be able to afford to pay it back the month after. The lenders will judge the maximum that you can take by the amount of money that you earn each month. However, personal loans can usually be taken for as much as £10,000, which can offer a better chance of affording everything that you need.
Both types of loans can help your credit rating. The no credit check loans can show that you can borrow small amounts of money and stick to a date whereas personal loans can show that you are able to make installments each month and borrow over the long term. However, both types of loans can also do the same amount of damage. If you default on an installment or you fail to pay the no credit check loans back on time, you will be proving that you are an irresponsible borrower.