These loans are provided within 24 hours into the borrower’s bank checking account, without making any credit checks. This is because the loan amount is approved against a post-dated cheque from the borrower. The cheque consists of the loaned amount and fee.
Another reason for the approval being without any enquiries is that the amount of loan is very small, in the range of 100 to 1000, depending on the borrower’s monthly salary. The approval comes for two weeks only. This means that the borrower will repay the loan at the time of next paycheque. Clearly, there are few risks for the lenders.
However, No Credit Check Loans, also known as payday loans, are very expensive for the borrowers. Interest rate on these loans may go up to 30 percent, taken as financial charges. This clearly means that you will have to make high interest payment on total amount of the loan. What is more disadvantageous is that the financial charges will go higher once you extend the repayment.
A history of late payments, defaults and arrears is seldom a hurdle in approving the loan instantly. If you are a salaried person, getting fixed monthly salary, then these may be perfect loans.
To find a suitable deal, search the internet extensively. Some of the lenders may offer you no credit check loans at lower financial charges. Repay the loan on due date for improving your ratings and for avoiding any debt.