Credit history is an important part of finances which we cannot avoid, even if it is a bad one. Credit history is the document that will be checked by anyone who wants to verify a person’s credibility and background. Having a good credit history reflects the positive side of the person, and ensures that the person is bankable. Bad credit history can be repaired
in many ways, and can be improved over time to reflect good scores. Although credit cards are the main reason for debt situation, they are the easiest way to build a good credit history too. Applying for loans, purchasing automobile, and even renting an apartment becomes very difficult without credit history. Although having credit history is very important, some people like to manage their finances without the risks of the credit cards. Here are some ways to deal with the no credit history situation, when credit checks are needed:
No credit Loans
Loans are very necessary when it comes to resolving a financial crisis. But obtaining loan is not easy without going through a credit check first. All loan companies depend on credit checks to ensure that the person applying for loan is credible. But there are ways for people with no credit history to obtain loans too:
- Money lenders usually provide loans without credit checks for little higher interest rates. Short term loans that have to be paid off within a year or so will be available too, for some extra money.
- Employment record can serve as a proof for credibility, instead of credit checks. For loans without credit checks, employment records must be presented at the time of applying for the loans.
- Having a cosigner might help in getting better rate for the loans. But finding a cosigner is not that easy, since the person signing up must be willing to take the risks in case the loan cannot be paid off.
- Payday loans can be taken if there is a crunch at the end of the month. This must be returned immediately though, otherwise the penalties can be quite high.
- Talking to local banks may be one option to get a no credit check loan. Since they hold the account of the applicant, credit check may not be necessary.
- Automobile loans can be obtained from the dealer selling the automobile. Although the interest rates are higher than the other banks, it saves a lot of paperwork associated with credit checks. This facility may not be available with big and popular auto dealers.
- Home loans need a bit more work, since the amount required is a lot higher. Getting recommendation from landlords, employers and colleagues will help strengthen the application.
- Checking in the local papers for no credit check loans can give an idea about the loan companies and banks lending unsecured loans.
Taking a loan not only helps relieving financial tensions, but also helps in building credit history
. If a person is planning to apply for credit cards, loans are a great way to build a good credit history and get approved for a credit card.