Even if you think it is impossible for Canadians to be approved for a loan without a credit check, this is not the case. In Canada, loans without credit investigations are an excellent substitute for more traditional loans from banks or other major financial institutions. No credit check with your creditworthiness; instead, you will have to prove otherwise that your current financial situation can support additional financing.
Alternatives to credit surveys
So, if a lender does not require the credit check to approve a loan, what does he need instead? As mentioned before, the lender will generally check creditworthiness through another form of valuation. If you choose to work with a lender who does not consider credit ratings in their underwriting procedures, you will typically need to provide one of the following:
Some lenders who do not take the credit rating into account will require you to provide them with bank statements to check how much money enters your bank account monthly. Lenders can thus ensure that you can actually support this loan. If you already have a too much financial responsibility, a lender might not want to approve you a loan. There are many ways to do this, but here are some of the most common ones:
- Instant banking verification. There are many programs that provide this service. You will log in to your online bank through the program your lender uses and will automatically take a snapshot of your account and build a report. Your lender sees a report, not your account information.
- Electronic declarations. All banks offer electronic returns via their online banking portal, and a lender can request them to validate your financial situation.
- Or you can simply fax your bank statements to your lender.
Documents to confirm your income
Another way for the lender to assess your creditworthiness without doing any credit check is to check your income. Lenders want to make sure that they will be reimbursed on a regular basis and it is important for them to only provide loans to people who have enough income to repay. Most lenders do not seek to create additional financial difficulties for their clients.
If you think your credit rating or financial history may be detrimental to your chances of being approved for a loan, you should consider providing collateral. Most secured loans do not require a credit check because your assets make your credit history less important. The guarantee protects the lender. This is a great way to get a personal loan that is $ 5,000 or more. With a secured loan, you will not have to accept a credit check and will have a better chance of getting a higher loan.
Lenders who do not check your credit rating
If you are looking for a loan from a bank or other more traditional financial institution a credit check is always required. This is how banks assess the creditworthiness of a potential borrower. If you know that your credit rating is not extraordinary, you could avoid applying for a loan from major financial institutions. If you want a fast, short-term loan or simply without a credit check, you should consider the following types of lenders:
- Alternative lenders. Mostly found online, they are willing to work with borrowers who are rejected by banks.
- Private lenders. They do not need to follow the same strict guidelines as the banks.
- Lenders specialized. Work with specialized lenders (for example, private mortgage lender or title lender).
The approval process without a credit check is based on more than just a 3-digit number. This means that more people are able to get approval for the loans they want and fewer people are rejected because of their past financial missteps. The Bridge Lenders are willing to work with you to find the loans, terms, and products that best fit your borrower needs.