Sometimes, the monthly paycheck is not enough. Whether you receive an unexpectedly large utility bill or a have to pay for a medical prescription, being able to quickly borrow a few hundred pounds can be a lifesaver. Unfortunately, most banks do not offer short-term loans other than the payday advances that come with a large number of taxes and fees. In some cases, banks may not even offer the amount of money that you need if you have a poor credit score.
If you find yourself in need of a small financial boost, then you may want to look for other ways to borrow money, such as one of the many online services that are currently available throughout the United Kingdom. These platforms allow you to borrow small amounts of money for up to 3 months without any sort of financial verification.
Here’s what you need to know and to do in order to get a short-term loan without having to pass a credit score check.
Step 1 – Know what options you’ve got
There are several options to choose from when it comes to money-lending services, each with their separate advantages and disadvantages.
Depending on how much money you need, there is the option to:
- Register on a Peer-to-Peer Lending platform – These allow you to borrow money directly from another registered user. The platform only ensures that the transaction goes through smoothly and that everyone keeps their end of the bargain;
- Use a crowdfunding service – While not technically a loan, it is possible to ask the whole userbase of the platform to contribute with money in order to help you with a particular project. Crowdfunding platforms are usually preferred by those who have very specific goals that require large sums of money;
- Commercial lending platforms – These are websites that act as banking interfaces between the users that need to borrow money and groups of private creditors. They operate similarly to banks, with the exception that the approval process takes considerably less time and the money transfer is not reported to any credit score registers;
All of these allow you to loan small amounts of money, usually up to 500 pounds, without having to pass a credit score check. Furthermore, in most cases, you will also be able to download an app that will help streamline the registration process and help you keep track of how much money you have received, how much you have to give back and when the deadline is.
Step 2 – Find the best service for you
Not all of these services are suited for everyone. It is important to understand what kind of financing they were designed for.
Peer-to-Peer lending platforms tend to be more personal, in the sense that it is possible to get in touch with the lender and work out the details of the transaction. The service only matches borrowers with lenders and takes out a small commission. This type of service is more flexible than others in the sense that there are no preset monthly interest rates or hidden fees that you must pay in case you miss a monthly payment.
Crowdfunding services, on the other hand, are somewhat more rigid due to the fact that you may only ask for money for very specific purposes and there is no guarantee that the community will invest in your idea. These services are more suited for individuals who need money to develop products or services that they can then sell.
Lastly, there are the commercial lending platforms. These have fixed rules and regulations that you must agree to before requesting a loan and manage the transaction in the same way as banks do. They give you the loan and set up a monthly installment system that you must follow in order to pay the money back. If you miss a monthly payment, you will have to pay an additional fee.
Step 3 – Make an informed decision
Keep in mind that all three types of online money-lending services can be used in order to borrow money regardless of your credit score. This having been said, some platforms will ask you to provide extensive private information, such as proof of identity, proof of income, and proof of address, before agreeing to give you the money that you need.
Furthermore, some of these platforms are more rigid than others, which means that if you cannot return the money on time, you will be penalized, which may result in you having to pay a larger amount of money than initially agreed upon.
This having been said, if you need a short-term loan, you may choose one of these platforms and borrow the money. Look at the options that are available in your area, decide which one suits your needs, and plan before borrowing the money.