2017 Guide: Best Ways for Getting Top Online Loans for Bad Credit
If you’ve had recent financial problems that have knocked your credit score down to the point where no bank will consider you for a loan, online loans with no credit check may be your only other option.
Finding online loans for bad credit isn’t an easy thing to do, however, and there are several predatory lending agencies that offer loans online for bad credit that will only further submerge you in debt because of their exorbitant interest rates.
Simply typing into a search engine “online loans bad credit” might leave you with a lender that charges extremely high interest rates on a long-term loan with stiff prepayment penalties.
To find the best payday loans online for bad credit, you will need to first do your homework and make sure that you research the best available options.
In this brief article, Advisory HQ will look at whether it is possible to get online loans with no credit check.
We will then go on to see who can benefit from bad credit loans online as well as analyze some of the drawbacks to online loans with bad credit.
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We will then look at three things that everyone should consider when searching for no-credit-check loans online before analyzing three of the most reputable companies that offer favorable loans for bad credit online.
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Is It Possible to Get Online Loans with No Credit Check?
While most banks have pretty strict minimum credit score requirements that are regulated by the federal government, there are other ways to find online bad credit loans.
Since the financial crisis of 2008, more strict regulations by the U.S. government have pretty much disallowed FDIC-insured banks from giving out loans to anyone with a credit score lower than 600.
However, companies that specialize in loans online for bad credit can offer loans to people with all sorts of credit histories and financial situations. It’s important to understand that loans online for bad credit aren’t going to be as favorable as loans offered by banks.
You definitely won’t be able to find online loans for bad credit with no credit check that offer you that coveted 3% to 5% annual percentage rate.
But if you find yourself in a financial tight spot and need to find online loans for bad credit, there are a host of options open to you that we will review below.
Who Can Benefit from Bad Credit Loans Online?
Online loans for bad credit can combine to lead you into a deeper financial hole if you don’t manage those loans wisely.
If you are suffering from a bad credit score, chances are that you haven’t been financially disciplined in the past. Online loans with bad credit almost always have higher interest rates and more severe penalties and fees for late payments.
You should only consider loans for bad credit online if you feel that you have the financial discipline to pay off your loan on time.
Furthermore, online bad credit loans can come in handy, especially for emergency expenses that pop up without warning. But using online loans for bad credit to purchase the newest smartphone or a bigger high definition flat screen TV probably isn’t a great idea. The high interest rates and unfavorable repayment terms are only worth taking on in a true emergency.
No-credit-check loans online can, however, be extremely helpful if you need to pay emergency medical expenses or some other expense that simply can’t be put off.
Furthermore, if you’re a little short on rent for the month and your landlord has threatened to evict you if you’re even a day late for payment, loans online for bad credit may very well save you from having to sleep on your parents’ couch.
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Some Drawbacks to Online Loans with Bad Credit
The most important negative aspect to online loans with no credit check is the interest rate that you will be paying. While banks and credit unions can usually offer you loans with an APR under 10%, loans online for bad credit will routinely charge you much more than that. Payday loans online for bad credit can routinely charge interest rates well over 100%.
According to consumerfinance.gov, “a typical two-week payday loan with a $15 per $100 fee equates to an annual percentage rate (APR) of almost 400%.”
If online loans for bad credit with no credit check are your only option to get money quickly, you need to be sure that you’re committed to paying off your loan as quickly as possible.
Another drawback to online loans for bad credit is that they routinely only offer loans for small amounts of cash. If you need $10,000, chances are that most online loans with no credit check won’t be willing to give you that amount of money.
Furthermore, the time you need to pay back that money will rack you up quite a bit of interest.
If you need to borrow more than $1,000, you’d be better off trying to quickly improve your credit to qualify for a loan from a bank rather than relying on high interest online loans with bad credit.
Three Things to Look for in Payday Loan Online for Bad Credit
If you have come to the conclusion that no-credit-check loans online are your only option, here are three indispensable things that you should look for in the best loans for bad credit online.
- Loans for Bad Credit Online with a Clear Interest Rate
You know that you are going to be paying a heavy interest rate on most online bad credit loans. However, there is a huge difference between understanding and accepting that 200% APR and finding that your interest rate has unexpectedly shot up to 300% overnight.
Many of the less trustworthy companies offering loans online for bad credit don’t have the clearest guidelines for the interest rates that they charge. You may be offered one seemingly favorable interest rate only to find that the fine print (that you didn’t read) mentions that the APR triples if you don’t pay off your loan within a certain amount of time.
Furthermore, companies offering bad credit loans online usually mention “rates as low as…” As a borrower, be extremely cautious with companies that offer online loans for bad credit at interest rates much lower than their competitors.
Chances are that you won’t qualify for the interest rate they are advertising and that they’re only trying to lure you in to stick you with an online bad credit loan that will further mire you in debt.
Whichever company you choose for your online loans with no credit check, make sure that they have a clear and steady interest rate that won’t unexpectedly shoot through the clouds.
- Online Bad Credit Loans with Flexible Payment Plans
The goal with all online loans for bad credit is to pay off your loan as fast as possible. However, sometimes your personal financial situation simply won’t allow you to do that.
Finding online loans with no credit check that permit a certain amount of flexibility in payment plans is important if you feel that you will need a little extra time to pay off your loan.
For example, most payday loans online for bad credit require you to pay back your loan amount within two weeks. If you don’t, you will usually suffer severe penalties and fees.
More trustworthy and reputable companies, however, may allow you to roll your outstanding balance from your previous payday loan for bad credit into a new loan. You’ll still be stuck paying the high interest rate but at least you can avoid those unpleasant fees.
- Loans Online Bad Credit with No Prepayment Penalties
As we’ve stressed throughout this article, bad credit loans online should always be paid off as quickly as possible. Let’s say that you applied for an online loan for bad credit with no credit check for $1,000. The loan term was for six months at 30% APR. If you followed the payment plan, you would end up paying around $150 dollars in interest.
If after two months you could save up the $1,000 that you owed, you could pay off the loan and save considerable money in interest. However, if your online loan for bad credit charged a $150 prepayment penalty, you would end up paying even more than if you were to pay off the loan over the six-month period.
Make sure that you research companies offering online loans with no credit check to find a company that won’t charge you a stiff and unfair prepayment penalty.
Top Three Companies That Offer Online Loans for Bad Credit
Once you’ve made the decision to find the best loans online for bad credit, start your research with these three quality companies.
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- Bad Credit Loans Online from BadCreditLoans.com
BadCreditLoans.com is one of the leaders in online loans for bad credit. They connect people in need of cash with a network of lenders who are willing to take a chance and offer you favorable loan terms and conditions. If you can show that you have been employed for at least 90 days, you may receive multiple offers from different lenders, thus allowing you to choose the best bad credit loan online for you.
While the interest rates may vary anywhere between 150% and 1,000%, you are under no obligation to accept these interest rates on the online loans for bad credit that you are offered and can opt to simply wait for a better offer.
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- Bad Credit Loans Online from NetCredit.com
NetCredit is another leader in bad credit loans online. You may be eligible for online loans for bad credit up to $10,000. There are no hidden fees on the long-term online loans for bad credit that they offer, meaning that you will only have to pay the interest owed on your loan. Their website is easy to understand and clear about the requirements.
- Bad Credit Loans Online from Avant.com
If you have a credit score anywhere above 580, you may be able to apply for a bad credit loan online from Avant.com. There are absolutely no prepayment fees on the online bad credit loans offered by Avant.
Their maximum loan amount is $35,000 which is high compared to other lenders that lend to people with subpar credit. Avant also has received an A+ rating from the Better Business Bureau, making them a proven lender with a trustworthy reputation.
Other Options for No Credit Check Loans Online
If you’re not satisfied with the options offered by typical companies offering no-credit-check loans online, there are other options. Asking for a loan from family members or from your work may very well allow you to receive a much more favorable interest rate.
Furthermore, peer-to-peer lending groups are gaining acceptance in the lending world. Peerform.com is a peer-to-peer lending network that offers online loans for bad credit.
While you may find lower interest rates at this website, it can take up to two weeks to get your loan approved and there are certain fees that come with these loans. Luckily, their website clearly explains the ins and outs of applying for peer-to-peer loans.
How Online Loans for Bad Credit Can Get You Out of a Jam
While none of us enjoy having to pay high interest rates on online loans with no credit check, sometimes there simply isn’t any alternative.
By taking the time to search for the best companies offering bad credit loans online that won’t secretly raise your interest rate or charge you an arm and a leg for prepayment on your loan, you can make your online bad credit loan work for you.
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