No Credit Check Payday Loans Explained

What is a no credit check payday loan?

Put quite simply, a ‘no credit check payday loan’ suggests a payday loan where your credit file won’t be checked by the lender. However, this isn’t strictly the case. All payday loans include some form of credit check; at the very least an identity search will be carried out to ensure the borrower is not bankrupt.

These loans are usually small amounts of up to £1000 and are generally short term to lessen the time the lender is at risk. But bear in mind that payday loans without a credit check should be approached with caution.  Sufficient credit checks are usually put in place to protect customers, so it’s best to choose a lender that carries out complete credit checks instead of bypassing them.

Why would someone choose a no credit check loan?

A no credit check payday loan may seem like a good solution if you have a bad credit history, or even no credit history at all. This means that people in a bad financial situation could be more likely to be able to borrow money, as there is no credit check.

What are the advantages and disadvantages of a no credit check payday loan?

Although no credit check loans could seem like a quick and easy solution to your financial woes by not looking into your credit score, you could be worse off in the long run. Traditional credit checks include considering the borrower’s address, credit they have outstanding and how they’ve managed credit in the past, to objectively judge if they can afford the loan and can pay it back without getting into financial difficulty. For this reason, it’s best to opt for the safer route and apply for a loan that looks at your credit score.

What is a credit score?

Your credit score is based on your financial past and is generally in place to predict your future behaviour so companies can check if they can trust you to pay back the money that they lend to you. It can affect your ability to borrow money through credit cards, loans and mortgages. In terms of loans, it is used to help lenders decide whether you are an acceptable applicant, how much to lend to you and how much interest to charge.

There are three credit reference agencies in the UK, which allow you to check your credit score. These are CallCredit, Equifax and Experian. These organisations compile information about you and will supply this to a lender when you apply for credit. They gather their information using electoral roll information, court records, and information from other lenders you’ve applied for credit with, including bank accounts, loans, mortgages, energy or mobile phone contracts.

Because lenders don’t always share the same information with all three agencies, there is no such thing as a universal credit score. Each of the credit reference agencies will score you based on the information they have, so don’t be alarmed if you find three slightly different versions of your credit score when you check. Each agency also has a different idea of what is a ‘good’ credit score, and has different ways of showing what a good, bad, or excellent score is.

What causes a bad credit score?

A bad credit score can be a result of a number of factors. The most common causes of a bad credit score are:

  • High levels of existing debt
  • Late or missed payments on loans, bills, mortgages, credit cards
  • Bankruptcy
  • A County Court Judgment
  • Not being on the electoral register
  • Sharing a joint account with someone who has poor credit history
  • Making a number of applications for credit in a short period of time

How do I improve my credit score?

If your credit score is in the poor or fair band, it might be worth considering some steps you can take to improve it. A simple solution is to check your credit report using one of the credit reference agencies mentioned above to ensure there are no mistakes which could be bringing your score down. If you do find mistakes, such as your address having been recorded incorrectly or misspelt, report them to the agency as soon as possible.

It’s also a good idea to register on the electoral roll if you have not already. Try your best to stay on top of all of your bills, including your phone and utility bills, paying at least your minimum payments each month, and end financial associations with those who have a poor credit rating. Finally, it’s also helpful to only apply for new credit if completely necessary, as any applications leave a footprint on your credit file which could lower your score.

Does Sunny offer no credit check loans?

We do not offer payday loans without a credit check, because we prioritise our borrowers’ financial security. Therefore, each application we receive is quickly assessed by taking a number of factors into account, such as people’s addresses, bank details and employment details, as well as their credit history.

In the meantime, if you’re in need of extra money fast to make ends meet, we offer alternative loans that may be suited to you. While they do involve a credit check, our loans are quick and secure, with flexible repayment options. Our simple online application will deliver a decision in minutes and if approved, the money will arrive in your account in as little as 15 minutes.

Why choose Sunny?

At Sunny, we guarantee there will be no extra fees throughout your loan process. This means you do not have to pay extra for administration or application fees and you won’t be charged extra for late repayments.

We believe in honesty, transparency, and fairness, which is why we are one of the UK’s most trusted short-term loan companies. Our loans are designed to be as straightforward and flexible as possible to put borrowers in control of their finances. Even after borrowing, we offer a 5-day cooling-off period in case you change your mind, during which we won’t charge interest if you call us to repay your loan.

We aim to provide borrowers with a lifeline so they can achieve a better financial future. If you have any additional questions regarding payday loans or our flexible loan options, please visit our Frequently Asked Questions. Alternatively, don’t hesitate to contact us using our online live chat.