From a needle to cruise, the purchase of everything depends on money. Food and drink, utility expenses, and travel cost add up to a large amount at the end of the month leaving you strapped. Despite putting aside money for emergency cushion, you are left with zero savings because your impulsive habits force you to dip into them.

 
Emergency expenses can catch you by surprise anytime - like car repair and unexpected medical condition - when you have already dipped into your savings. In this situation, you have got only one option - turning to direct lenders.

Among various short-term loans available, choosing the right one that fits your budget and repayment capacity seems to be very discombobulating, especially when your credit rating is less-than-perfect.

Most bad credit borrowers want to borrow loans without credit check because they do not require hard credit inquiries. You do not have to be afraid of losing your credit score, nor need you to arrange collateral. Further, these loans come with ‘no guarantor’ facility.

While the terms and conditions are so lenient, what helps a lender to hold all the aces? Of course, the lender will not disburse you money unless they are certain that you can afford it. Direct lenders approve your loan application despite the high default risk. How will they benefit from it? They charge high interest rates for bad credit loans. Even if you fail to repay the debt, they can recover the loss through interest that is usually three times or four times more than the amount you borrow.

One missed repayment may cost you a small fortune because you will pay late payment fees along with interest. For instance, you borrowed £500 for a two-week period on which you have to pay £30 as interest. If you fall behind the repayment date, you will end up paying £30 as interest penalty and £530 toward the debt after next two-week period.

Applying for the loans can be a bit expensive especially with less-than-stellar credit history. Once you fail to repay the loan, the late repayment fee will continue to add up throwing you in a permanent cycle of debt. So, what should you do? Go towards loans without credit check.

What does no credit check means?

If you have a poor credit score, not all lenders will approve your loan applications, and if they do so, you will end up paying high interest rates. A no credit check loan means the lender will run neither hard credit check nor soft credit. You can apply for these loans even if your credit score is bad without any hindrance. The lender will approve your loan immediately as you out in the loan application.

Are there any other alternatives?

Well, whether you apply for loans for bad credit with no guarantor and no credit check, the risk of falling in debt is high provided you borrow more than your affordability. If you are running out of money and an emergency has reared its head, you should take a look at your credit report.

A credit report consists of all of your personal details, repayments, defaults, CCJ if any etc. You should ask a copy of your credit report from credit reference agencies to make sure it does show all details accurate and does not record a default that is out of your knowledge.

Try to improve your credit score by making all debt payments on time, settling credit card bills within the grace period and paying utility expenses on time. If you continue to meet your financial obligations, it builds your creditworthiness and automatically boosts up your credit score. The higher the credit rating, the lower the interest rate will be.

You should also try to take out installment loans. These loans allow you to repay the debt in equal monthly installments. They are not only manageable but also help you build your credit.

Before you take out a loan, you should make a budget to have a clear idea of your incoming and outgoings. A budget will help you know about your repayment capacity.

No matter, which type of loan you take out to fund emergency, you should always try to contact a lender who offers these loans at competitive interest rates.