No Credit Loans

No-Credit-Check Personal Loans

All loans, personal or business, require collateral. Personal loans mean that you pledge anything you own, home, property, car, and investments against the loan amount to cover what is being borrowed. Unless you can afford to lose whatever it is that you own, a loan from any source will only hurt you if you cannot pay it off by the due date.

Then, there is the matter of interest. A bank or credit bureau loan will have at least livable interest rates. Check, and double-check, the interest expected on any no-credit-check loan. Always be aware that this type loan will have an interest rate at least twice the amount of what someone who with good credit could get.

Ask yourself if you can pay off the loan within the stated term. Take out a calculator, and figure what the interest actually will cost, not only each month but in the long term. The formula is principal x rate x time.

Any interest rate over 20% (and many regular credit cards now charge that much) means that every month you use the service, your minimum payment is exactly that – minimum. Any remaining balance gets 20% or whatever added to it-and next month you will be charged that same interest rate against the remaining balance. Including the interest amount the loan company added last month. The same is true for any type personal loan.

On a no-credit-check loan, the interest rate will be even higher. And let’s face it. Wouldn’t you want something to guarantee the loan amount from someone without a credit check? The people offering these loans will have guarantees, both in the ability to take over whatever property you pledged (and it’s a crime to sell any such property until the loan has been paid), but will also hold you accountable for the amount loaned and all interest accumulated.

People with low credit ratings do sometimes need backup funding. Often, however, they meet with close to what I would call loan shark practices where the debtor who cannot get a loan without a credit check will owe forever to repay a loan that will only help the debtor through a temporary emergency.

First, check with your bank and your credit bureau if you have one. If you cannot get a loan there, ask these places to suggest a debt consolidation firm to help you get your payments under control. Do not call firms that advertise through television or online. Some of these firms may be legitimate. Many are not.

At time like this, with so many people caught in the economic downturn, please be aware the today’s “loan sharks” are out to take advantage of legitimate need and to capitalize on it – for themselves, not for you.

Believe it or not, there are still personal loan sources available if you have good credit. If your credit isn’t good enough to get a personal loan from a legitimate source, ask advise from those sources on where to look. Just don’t throw all of your remaining assets away by believing some lending agency is giving something for nothing.

It’s just not the way things work. Times are hard, but protect yourself for tomorrow!