How Do Payday Loans for Bad Credit Work?

The application process for these loans is typically done through an online application form or the payday lender’s app. To apply, you need to meet the following qualifications: Be 18 years of age Be an Australian citizen or permanent resident With contact details such as mobile number or email With bank statements containing the latest 3 months of regular income and expenditure transactions. Government benefits (Centrelink) shouldn’t exceed 50% of your income.

Where Can I Apply for a Payday Loan if I Have Bad Credit?

You can apply directly with a payday lender that offers no credit check loans. Applying directly can be cumbersome though as you’ll need to keep resubmitting applications with individual lenders until you are approved. Using a service like Friendly Finance can quicken this process up.

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Why Should You Choose a No Credit Check Loan?

Low loan amount
with short-term repayment period

Borrowers with bad credit history can get a no credit check loan of up to $2,000, payable on their next paycheck or up to one year depending on the final approved loan terms.

Available for individuals
with poor credit scores

Unlike regular payday loans, no credit check loans are extended to individuals with poor credit history. Loan application approval, however, is still subject to the set criteria.

What are the Eligibility Requirements for a No Credit Check Loan

Be 18 years of age
Be an Australian citizen or permanent resident
With contact details such as mobile number or email
With bank statements containing the latest 3 months of regular income and expenditure transactions. Government benefits (Centrelink) shouldn’t exceed 50% of your income.

Your current financial standing, source of income, and other supporting documents may be required before extending a loan approval. As part of the application process, you’ll need to retrieve 90 days worth of bank statements. This is very simple and only takes a couple of minutes to complete.

The turnaround time on the application process for payday loans is usually 1 to 24 hours. Funds are also released within hours from the approval of the online loan application and submission of the signed debt agreement.

Disclaimer: Whilst we will not run a credit check as part of our matching process, we cannot guarantee your matched lender will not run a credit check before final loan approval

Understanding the Loan Offer Process

Curious about how a loan offer works? Here’s a straightforward guide to help you navigate from application to cash in hand.

Step 1: Begin Your Application

Start by completing a simple application online. Whether you’re cozy at home, commuting, or sitting at your desk in the office, applying only takes a few minutes.

Step 2: Review Your Loan Offer

Once your application is submitted, you’ll receive a loan offer. This document outlines the proposed terms of your potential loan. It’s important to review these carefully as the terms will impact your repayment plan.

Step 3: Await Approval

After reviewing the offer, the next step is the approval process. We aim to provide a decision swiftly while ensuring fairness. Typically, approval is granted within one business day, and you’ll be promptly informed of the outcome.

Step 4: Access Your Funds

Upon approval, the funds are transferred quickly to your designated bank account. In some cases, this can happen on the same day, giving you access to your money as soon as possible. Alternatively, you might choose to collect the funds in person.

With this clear and simple process, receiving a loan offer and accessing your funds is straightforward and efficient.

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What are the Fees for a No Credit Check Loan?

Monthly fee Establishment fee Default Fees
The monthly fees for a no credit check payday loan has a maximum rate of 4% of the total loan amount.

It is against regulatory guidelines to impose an establishment fee exceeding 20% of the total loan amount. Establishment fees are usually just a one-off fee.

Default fees shall not exceed 200% of the loan amount. This should already include any additional enforcement expenses charged to the borrower if the borrower fails to pay the amount due.

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No Credit Check Loans FAQs

Where Can I Apply for a Loan if I Have Bad Credit?

You can apply through Friendly Finance. Here we offer a simple application process that is purely online. Just provide the information needed and let us do the heavy lifting of helping you find a no credit check loan.

What is a No Credit Check Loan?

Similar to a traditional payday loan, these unsecured loan products offer borrowers loan amounts from $100 to $2,000 and repayment periods from 16 days to 1 year. Unlike a traditional personal loan, they are extended to borrowers with poor or no credit who may struggle to find finance elsewhere. A low credit score with Equifax – the largest credit bureau in Australia, is a score lower than 579. A low credit rating indicates a poor financial history and suggests a more risky borrower.

What Can a No Credit Check Loan Be Used for?

Immediate Travel Needs – Whether it’s a family situation or a work commitment, no credit check loans can help cover travel costs like flights and accommodations, allowing you to get where you need to be promptly.
Housing and Rental Costs – Need help with a rental bond deposit? Access funds fast so you don’t miss out on securing your dream home.
Pet Care Expenses – Veterinary bills can be costly. A quick loan could ensure your pet gets the crucial treatment or healthcare they need without delay.
Educational Fees – Don’t let financial constraints hold back your or your child’s education. These loans can cover tuition, books, and other learning materials.
Healthcare Bills – Unexpected medical costs can be challenging. Use a no credit check loan for essential medications, treatments, or doctor visits to prioritize your health.
Home Maintenance – Home repairs can’t always wait. From fixing a broken appliance to addressing structural issues, these loans can keep your living space comfortable and functional.
Celebrations and Events – Life’s special moments deserve to be celebrated. Whether it’s a wedding, anniversary, or birthday, an infusion of cash can help you create memorable experiences without financial strain.

What are the Repayment Options for No Credit Check Loans?

In compliance with government regulations, repayment options for borrowers are limited to 16 days to 12 months only. As part of the rules of responsible lending, the repayment period is determined by any responsible lender and will consider the borrower’s capacity to repay even with a bad credit score. Knowing the exact repayment period and paying off payday loans on time for payday loans would improve the borrower’s credit score and will eventually give them access to loans with better terms.

To streamline your repayment process and help avoid missed payments and extra charges, your loan repayments will be automatically set up via direct debit. This means that the repayment amount will be debited directly from your account as the lender sets up a direct debit at the start of your loan agreement.

Funds will be digitally transferred from your bank account to the lender on the dates you agree upon. Additionally, we can tailor your repayments to align with your pay cycle. For instance, if you’re paid monthly, you can opt for monthly repayments. This flexibility ensures that your loan management is as convenient as possible, helping you stay on track with your financial commitments.

Will a No Credit Check Loan Affect my Credit Rating?

Taking out any type of credit or loan will affect your credit score. How it affects your credit rating will depend on your payment behaviour. Your credit profile will improve if you keep on paying your payday loans (or even loans with any traditional lender) on time since this demonstrates positive financial behaviour as a borrower. However, if you fail to make repayments and default on your loan during the loan term, your credit score will suffer.

Are There Other Options Instead of a No Credit Check Loan?

Apply for No-Interest Loan Schemes (NILS): NILS is a better alternative to a bad credit loan since it does not include monthly fees in your repayment amount. If you need to pay for essential goods and services such as household items, medical expenses, or car repairs, you can apply for NILS through a local provider.
Credit Union Loans: A credit union loan is a good alternative to payday loans since this does not include high monthly fees. You can take out a credit union loan to 76 credit union loan providers in Australia.
Department of Social Services (DSS) Emergency Relief: DSS offers emergency assistance to individuals with difficult financial circumstances. You can go to the DSS website to check for the local emergency relief provider to ask for their local relief qualifications.
Overdraft: An overdraft facility with your banking institution may provide access to funds if your credit search isn’t fruitful.

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