It is extremely difficult, if not impossible, to get a conventional loan with bad credit. So what to do when you have an urgent need for money? As a general rule, the only solution is the $1,000 loan without credit check, or any other amount, within the $3,000 limit. But how does this type of loan work and what are the criteria to meet to obtain it?
The loan without credit check can be granted even with bad credit
Before granting a loan to a customer, a traditional bank consults his Credit Report from two Canadian credit bureaus, Equifax and TransUnion. In other words, it checks his three-digit score, as well as his credit history. Even if any banking establishment establishes its own policy, it should be noted that each of them has a minimum credit required to grant a loan.
Unlike traditional financial institutions, private lenders who grant a $1,000 loan without credit check, or even $3,000, take a different approach. They prefer to take into account the borrower’s current situation, his current income, debt and financial management to grant him a loan.
The loan without credit check: an immediate solution to manage urgent situations
Another big difference between a conventional loan and a personal loan for bad credit is that the latter is granted very quickly. As a general rule, whether for a loan of $1,000 without credit check or a higher amount, the response is given within 24 hours, or even sometimes within an hour of sending the requested documents!
Besides, the loan application process is extremely easy to complete and only takes a few minutes: you fill out an online form and send the documents requested to complete the file which is most of the time:
- The last three payslips
- Proof of residence
- Two pieces of identification (with photo)
- A specimen check
- Bank statements for the last 90 days
The loan without credit check: perfect for creditworthy borrowers with a low score
Since this type of loan is not granted according to the score and the credit history available with Equifax or TransUnion, how do you get a $1,000 loan without credit check? To consent or decline a quick money loan to a borrower, private lenders rely on the amount of income, level of debt and current financial management.
The applicant must also:
Have a checking account for at least three months
Have a full-time job for at least three months
Receive compensation by direct deposit
Not have a garnishment on wages
Not be in bankruptcy or a consumer proposal, or be released from it.
Loans without credit check are a temporary solution to deal with an urgent situation. They must therefore be used in this context and in moderation to prevent the borrower from falling into the over-indebtedness trap.