Meaning Of No Credit Check Payday Loan
A loan without a credit check is granted to you without performing a credit check. Is UK law requires that credit and affordability checks be conducted before any credit is granted? In no credit check loans, this soft check is done.
A soft check allows for a decision in principle about loans. This protects your credit score from the hard search
Only after you accept a loan offer and have signed the credit agreement, will a hard review be conducted.
What Is A Credit Check?
The company that you are applying for credit to will need to see your credit history before they approve you. Nearly everyone in the UK is a member of one of the four major credit reference agencies. This file contains information about your financial status and how you’ve managed your money in the past 6 years.
This file will be used by companies to determine whether or not to lend to you, and if so, at which interest rates.
What Is A Soft Credit Check?
Companies use soft credit checks to quickly assess your financial situation.
Soft searches cannot be seen by any other companies that are looking at your credit file in the future, and they do not affect your credit score.
What Is A Hard Credit Check?
To get a full understanding of your financial situation, a hard credit check will be performed. All your credit accounts, amount owed, what you pay, and missed payments will all be displayed.
This is the most common type of check before a credit application is approved. However, it is important to note that your credit file will also include a hard credit search for 12 months. Anybody who views your credit file at a later stage can see all hard searches. You may not be able to get credit if you do too many searches in a short time.
Why Would You Want A Payday Loan Without A Credit Check?
You may be looking for no credit check loans for a variety of reasons. The most common reason is your credit rating being in the red or towards the bottom end of the scale. This is particularly true for people with CCJs or IVAs against their names. You’re probably familiar with the disappointment of being turned down for a loan, credit card or other financial option due to poor credit.
Credit score can be affected by anything, from defaults on payment to bankruptcy to maxing your credit or not being on the electoral rolls. You may be eligible for a loan with no credit check if any of these conditions apply to you. The FCA has made significant changes in 2014 to regulate payday loans. Credit and affordability checks are only one example of the changes.
This loan can help you get cash whenever you need it. They are not long-term loans and are specifically designed to help you get cash until payday in case of an emergency. You can replace a broken washing machine or repair your car. The credit check and subsequent questions on loan applications are vital to ensuring that payday loans from Loanpig are the right fit and won’t cause you financial hardship.