How to Get a Loan with No CreditGetting credit approval without any previous history can be a frustrating process. The banks are often unwilling to take a chance on someone who doesn’t have a current credit score. There are a surprising amount of ways to start building your credit score from the ground up even with a tarnished or empty credit account.
Use a Cosigner
A cosigner is someone who signs official documentation alongside the lender. Choosing a cosigner that has a reputable credit score will bring trust from the company that the debt will be repaid. This debt will transfer to the cosigner if the lender is unable to make the payment on time. Missing a payment will affect both parties, so make sure to discuss the payment process and the responsibility of each party member.
Become Authorized on Someone Else’s Card
If you have a friend or family member with a credit card that is willing to let you share their account, you can become an authorized member on their card. You can’t be rejected because there is no application process. Any activity that this credit card brings can help increase your score depending on how the card is treated. Being an authorized user does not make you legally obligated to pay the other person’s debt.
Apply to Credit Unions
Credit unions are nonprofit cooperatives who allow for the mutual share of credit at low interest rates. Union membership is different from bank membership and is operated by its current members. It’s common for those in search of loans to find communities that allow for similar links, such as working within the same industry or location. Many credit unions will offer the same types of services as a bank would such as, checking and savings accounts, lines of credit, mortgages, and loans.
Maintenance and Rejection
Getting rejected for a credit card leaves notes on your file and the next lender is less likely to accept you if previous companies have rejected you. It’s important to space out your applications and to have a co-signer if you think you’ll be unable to meet the requirements of the company on your own. When getting access to any form of credit, it’s important to not miss a payment in order to build up a positive credit history.
Short Term Lenders
Many short term lenders can offer smaller loans with no credit check. Although they still need a good amount of personal information to verify who you are. These loans are generally faster and can be funded in as little as the next business day. One website with a good rating that can provide no credit check loans is LindgrenFinancial.com.