What Is A Consolidation Loan With No Credit Check?
A consolidation loan offers a way to merge all of your debts into a single sum. This figure will be loaned to you, allowing you to potentially pay off each amount much quicker and giving you peace of mind about managing your finances. If you have taken some damage to your credit score, either by missing repayments or applying for too many forms of credit in a short space of time, you may have found yourself looking for forms of consolidation that do not rely on your credit score.
While there are bad credit options available, such as secured debt consolidation loans, you may have been tempted to try a consolidation loan with no credit check from a direct lender. However, these must be approached with caution, as respectable lenders who are authorised by the FCA must conduct some form of check to ensure your affordability. If a lender is offering loans with no credit check, they may not have your best interests at heart, so take the time to consider your options.
With our alternative, we will run a soft credit check to match you up with a lender. This provides us with similar information to a full credit check, but no trace will be left on your report. A credit check will only show on your credit file once you have been accepted for the loan from the lender, allowing future creditors to track your repayments and providing an outlet to start improving your credit score. This is the closest option to a no credit check consolidation loan that you can find without putting yourself at risk.
The UK Rules On No Credit Check Consolidation Loans
The financial industry is regulated by the FCA, and in their sourcebook on Responsible Lending, they say that firms must undertake a ‘reasonable assessment of the creditworthiness of a customer before… entering into a regulated credit agreement.’ An assessment will be based on both information supplied by the customer and, where necessary, a credit reference agency.
The three main objectives and guidelines of the FCA are:
- To protect and enhance the integrity of the UK financial system
- To secure a degree of protection for customers
- To promote effective competition in the interests of customers
This means that any direct lender who approves debt consolidation loans with no credit check would not be operating within the guidelines. Before applying for any no credit check consolidation loans, you should check that the company is authorised. You can so this by searching the FCA’s Financial Services Register. However, as we are FCA authorised and perform a soft credit check, you can be sure that our services are safe to use and designed to find the best solution for you.