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Understanding the Basics of No Credit Check Installment Loans
step in the lending process undertaken between the lender and
the borrower is to check the credit history of the latter. In
this aspect, it can be said that most borrowers dislike credit
check. The reason is that they don’t want to reveal their
financial details to unknown persons. However, lenders insist on
the same as they have their reasons. This procedure is skipped
in no credit check installment loans.
Therefore without having a clear picture about the borrower’s
position in the credit market as well as his repayment
reputation, the lender is at a great risk. But they still go
ahead with it because of the lure of getting high interest.
Secured and Unsecured Loans
Regarding no credit
check installment loans,
there are two types. One is the secured loan and the other is
the unsecured loan. In case of secured loan you have to provide
collateral. Generally, strict conditions are imposed by the
lender on the borrower to avail this loan without collateral and
credit check. It is quite difficult to get the secured loan. You
have to fulfill certain conditions laid down by the lender. One
is that, you must have continuous employment and there is a
minimum salary limit. However, the loan amount provided in this
case will be proportionate to the salary and hence can be
considered as small. For unemployed borrowers providing
sufficient collateral is a must.
Actually secured loan can be defined as a
loan that is provided on the basis of collateral provided. In
case you default or fail to repay, the lender to recover his
loan amount will take possession of your collateral. The loan
amount that you will receive on providing collateral will be 70%
of its value. The interest rate is also high and therefore you
should utilize the said amount judiciously. Keep in mind that
there is heavy penalty on default and also low tolerance limit
due to high risk factor. On the positive side, you receive money
right on time and if your repayment is prompt then you can
really better your credit history.
Coming to the
unsecured loan scheme, its terms and conditions are simple and
manageable. It is a short term loan and you can avail
substantial funds. As in the case of
direct lender only
secured loans, unsecured loans also have to be repaid
within the specified time duration. Being unsecured in nature,
you are not required to provide collateral. The non-requirement
for collateral does however lead to high interest rates. You can
seek loan amounts up to
£25000 under this loan scheme. The eligibility conditions are
similar to what you are asked to provide under the secured loan
scheme. You should be 18 years plus, have a fixed source of
regular income and a checking account that is active for the
last six months. There is no paperwork involved and with a
hassle-free approval procedure, you can get your amount within
hours or at the most within one working day.
Both these loans are online loans hence you should do a proper
research on the internet to get the best possible deal.