Connect with us

Bad Credit

5 Best No-Credit-Check Loans in 2021

Published

on

When you have the inside scoop on the best no-credit-check loans, you can get your hands on the short-term loan you need without having to go through a credit report inspection.

This could be the most convenient and guaranteed option if you have a credit score that leaves you unqualified for most loans, or if you have recent negative marks on your credit report.

Many, if not all, credit unions and banks require you to undergo a credit check in order to get approved for their loans. However, some credit check lenders are willing to move away from the process, with a catch — higher interest rates or more fees that offset the high-risk nature of the loan.

Before you apply for any of these loans, read our article and our FAQs carefully to understand the process. None of these companies are fraudulent or scammers; however, expect your cost to be higher than those with a good credit score.

We carefully researched each website for legitimacy, ensuring you can trust them to help you with what you need.

Now, let us get into the list. 

Top 5 Best Companies That Provide No Credit Check Loans:

  1. MoneyMutual
  2. BadCreditLoans
  3. CashUSA
  4. Credit Loan
  5. Personal Loans

The biggest advantage of these online loan offices is that they more or less work together. You submit a loan application, and then all lenders in the network get your loan request. In short, you apply to many different lenders without the hit to your credit score.

Some on the network won’t require credit checks, while others may require it. If anything, it is a good way to get an idea of your likelihood to be approved without having to worry about someone seeing your credit report.

If you are qualified, you will receive an email with information on how to take the money.

#1. MoneyMutual 

Brand Overview

MoneyMutual is one of the biggest online lending networks in the United States, and the good news is that many of them do not require a credit check. Once you’ve got your approval for a short-term loan, you can do all the paperwork for it online and have the money put into your bank account the very next business day.

You have to be 18 years of age at minimum, possess a checking account that is active, and have an income of at least $800 per month. You also must provide documentation that states that you are employed. However, the requirements vary from lender to lender. The average borrower will be approved anywhere from $250 to $2500, however, the max amount you will be offered is based on your individual qualifications.

It’s a good way to connect consumers with quality short-term lenders that offer services such as payday loans, installment loans, and bad credit loans.

Features 

  • Loans available to you in 24 hours or less
  • Loans offered up to $2500
  • Millions of satisfied customers
  • Online form is easy to complete and takes five minutes

Pros 

  • Free to apply and use the website
  • Application period is short, fast, and easy
  • Apply to a big lending network and get multiple offers

Cons

  • Not offered to NY or CT customers

Customer Experience

The following are paraphrased reviews we took from real MoneyMutual clientele.

“I saw the TV ad and called right away. I had my money in no time. They offer loans for all sorts of things. My [payments] are taken out monthly.” – Jamie

“If you need cash fast, the way to get it is MoneyMutual…The repayment options are available to anyone who can make the payments back… One only needs to make sure that arrangements are made so payments aren’t late.” – Raven

⇒ Click Here to Visit the Official Website of MoneyMutual

#2. BadCreditLoans

Brand Overview

BadCreditLoans can get you a loan in the amount of $500 to $5000, and the loan terms will vary anywhere from 3 to 36 months. The interest rates will also vary, ranging anywhere from 5.99% to 35.99% APR. Your loan will depend on the lender they connect you with.

Their sign up is simple and includes three easy steps to complete. First, you must put in a request for your loan. Then, you will review the offers from lenders you’ve been connected with. Lastly, you will receive your money 24 hours after you sign the contract.

You are under no obligation to do this. If none of them work for you or you need more time to think it over, you are able to do so while continuing your search elsewhere. Also, the company  offers e-consent, meaning you can sign up electronically.

Signing up is easy. It just takes three steps to complete the application, and you’re in. First, you will put in a request for your loan. Secondly, you will review the offers from lenders you’ve been connected with.  Third, you will take a good look at the offers that have been sent your way.

Lastly, you will have your money as fast as 24 hours after you sign the contract. You’re under no obligation to do this, so if you need time to think it over, take it. Plus, the company offers e-consent, meaning you can sign electronically (no fax machines or snail mail necessary).

Features 

  • Loans up to $5000
  • Money available to you in 24 hours
  • Credit requirements are flexible
  • Many lenders to choose from
  • Been in business for over 20 years
  • Easy three step online application

Pros 

  • Very easy and simple to use
  • Ideal for people with less than stellar credit
  • Just one application connects you to many lenders

Cons

  • Loan process is easy, but requires a lot of personal information right away

Customer Experience

“BadCreditLoans was a pleasure to work with. The online request was fast and easy, albeit detailed, and the fact that ANYONE can submit loan requests opens many possibilities for consumers that are hard to approve.” – Laura Cook, MoneyUnder30.com

⇒ Click Here to Visit the Official Website of BadCreditLoans

#3. CashUSA

 

Brand Overview

CashUSA is not a direct lender, but instead a third-party company that matches those seeking loans to servicers that can offer them the best rates for their credit scores. So, when you fill out the online forms, understand you are not getting a loan directly from CashUSA, but instead through one of their partnered lenders.

The site itself is pretty easy to figure out. You simply go to the website and start by filling in your zip code, date of birth to ensure you are 18 and older, and the last four digits of your SSN.

You will then fill out more information such as bank account information, and job/work questions. It takes just a few minutes, and you then get offers from various lenders.

They send your criteria only to lenders that match your needs, so you don’t have to get your hopes up about a great rate only to find that you didn’t qualify anyway.

From there you can agree to the terms and conditions of your loan and get your money as early as the next business day.

Features  

  • All credit scores accepted
  • Loans offered from $500 to $10,000
  • Funds go directly to your bank account
  • Use your loan for any reason
  • Hear back from them in minutes

Pros 

  • Application process is easy and fast
  • Loans are offered to people of all credit rankings
  • Will help get you the best rate by comparing various lenders

Cons

  • Does not partner with all major lenders, so you might not get the best deal
  • State that they may be compensated for sharing your info

Customer Experience

“Easy enough to enter your info and get a list of potential lenders.” – Emery Gray, financer.com

“Quick cash when you need it. They are helpful and understanding, have low-interest rates and are quick.” – Shannon Peterson, financer.com

⇒ Click Here to Visit the Official Website of CashUSA

#4. Credit Loan

Brand Overview

Creditloan.com is straightforward and can get you a good sum of money fast. It’s a soft pull on your credit report, so your score will not be affected just because you looked for a loan. Once you fill out all the usual information, you will get loan offers in minutes, sign the paperwork over the internet within the hour, and receive your money the next business day.

Creditloan.com’s site says it can get you up to $25K, but the bad-credit loan limit is $5K. The requirements to apply for the loan are not too stringent.

You can’t  be a resident of New York or Connecticut, must be 18 years of age or older, have zero active bankruptcies, and have a form of consistent income plus a bank account under your name. Your bank account is needed so they ensure their monthly payments are received as you repay the loan.

Features

  • Loans from $250 to $5000 are offered
  • Bad credit applicants are accepted
  • Been in business since 1998
  • Takes just 24 hours to get your money

Pros 

  • Borrowers do not have to meet specific income guidelines to apply
  • Creditloan.com is A+ rated with BBB
  • Income sources can include annuities, disability/unemployment payments, rental property income, social security, structured settlements, student aid, and investment returns

Cons

  • Do not serve NY or CT customers

Customer Experience

“Their site was safe, and I was connected to a reliable lender. I was approved for a reasonable amount, but I could not provide the collateral, but the company they connected me to is good and well-known.” – Elizabeth, Trustpilot

“Customer service was very pleasant, and I enjoyed the experience because it was fast and easy.” – Angela, Trustpilot

“It was a fast and easy application, great payment plan as well, I am pleased.” – Rosalie, Trustpilot

⇒ Click Here to Visit the Official Website of Credit Loan

#5. Personal Loans®

Brand Overview

This is a loan aggregator service that works like many others. We were delighted to include it because they offer services to borrowers of both good and not so good credit situations. After all, everyone needs a loan at some point or another.

It’s pretty straightforward – you will begin by filling out basic information such as zip code, email, name, address, birth date, and military service status. Next, you will answer questions about why you need the loan and how much you need, and your credit will be reviewed. You will also need to enter your SSN, driver’s license information, and your bank information.

It’s an ideal place for new borrowers, especially because every step is explained clearly. It’s as if you are at a bank talking to a loan officer. Once the fast and easy process is done, it will take mere minutes until you start receiving offers for loans. We also liked that it matched borrowers with many suitable lenders, allowing them to choose which one works best for their individual needs.

Features 

  • Offers loans from $500 to $35K
  • Funds are sent to you in just 24 hours or less
  • Services offered in all 50 states
  • Online approval is fast and easy

Pros 

  • Great for all credit types
  • Max loan amount is $35,000
  • Get personalized loan offers that suit your financial situation

Cons

  • Strict protocols: no late payment histories, recent/active bankruptcies, or off-charge accounts

Customer Experience

“I was appreciative of this service and the reasonable APR I was granted. It’s hard to find a loan service online you can trust, and I trust Personal Loans!” – Kate M, SiteJabber

“Such a great experience! I got the loan I needed with no hassle, got approved, and got the money fast. Will make my home repairs easy. Decent APR, too!” – Rhi P., SiteJabber

⇒ Click Here to Visit the Official Website of Personal Loans

Factors To Look For While Getting A Bad/No Credit Check Loan

There are a few things to look out for while you shop for a bad or no credit check loan.

When you’re on the lookout for a lender specializing in such credit history, consider the following criteria: 

  • Customer service reviews/ratings
  • Repayment methods
  • Penalties and fees
  • Loan terms
  • Interest types and rates
  • Eligibility requirements; i.e., monthly income, employment status, etc.

Let’s discuss these criteria in detail.

Customer Service Reviews/Ratings

Make sure you take some time to read what others thought about that particular loan service. You are sure to find a few disgruntled customers, as a few of them probably did not read the terms of their loan closely enough, but the majority of the reviews should be fair or better.

It’s also a good idea to do some quick research on the company you’re interested in by checking out the Consumer Financial Protection Bureau to see what customers have to say.

Repayment Methods

Many lenders offer a variety of repayment methods to make it easier on you and to ensure they get their money back, with interest. For instance, automatic payments drawn from your checking account is one option and, in some cases, -might get you a discount.

Other methods include mailing checks or paying online using your banking information. Make sure your lender has a method that works for you.

Penalties and Fees

Returned check, origination, prepayment, late, insufficient funds, and processing fees could all apply to your loan.

Origination fees are charged for the lender having to process the loan in the first place. Not all lenders charge it, but those that do usually process a 1% to 6% fee. You might see this rolled right into your loan, or as a separate charge. It all varies according to the lender and your state.

A prepayment penalty fee is also dependent on the lender. Such a fee could wash away any savings you were hoping to gain by paying it off early. The fee is usually a percentage of the leftover balance or the sum of the interest charges for several months.

If you are late with your payment, you will likely be charged with a late fee. Some lenders offer a grace period, but be sure to check with your lender first. If you know you will be late, call your lender to see if they can work with you to avoid a fee.

These late fees are not cheap, some could be $30 while other lenders charge a percentage of your monthly loan payment (about 5% in most cases we’ve seen). Some lenders do not process late fees.

A returned payment fee will also vary but is usually about $15.

Loan Terms

When you get preapproved for a bad/no credit loan, you will be given the terms of that loan, which include your APR, loan restrictions, total amount paid, and loan period. Make sure you review them with a fine-tooth comb and that you are comfortable with the terms.

Interest Types and Rates

Be sure you compare interest rates to get the most affordable loan possible. The greater your credit score, the lower the interest rate, in most cases.

Most bad credit loan companies include fixed interest rates, which guarantees it will stay the same for the length of your loan.

A loan with a variable rate will fluctuate and move according to an index rate.

Eligibility Requirements

Lenders that specialize in loans with no credit will usually require you to have a credit score of 620 or better. The maximum debt to income ratio is usually capped at 45%. This ratio refers to how much you owe each month versus how much you are earning.

Most of the time, lenders advise borrowers to have a steady income to make up for their poor credit. Some lenders may require you to have a minimum annual income to work with them.

Others will look at your employment and how much money you earn when looking at your ability to repay the loan. Some lenders will look at other financial aspects of your life, such as your savings account when determining financial responsibility. By finding a lender that does this, those of you with no credit but no debts could attain a loan for whatever you need.

Some of these companies may require a co-signer as well. A co-signer can get you a better interest rate if they have good credit, good income, or both. But, if you default on the loan, they are the ones that have to pick up the tab. This could lead to a damaged relationship as well as damaged credit for the co-signer. Make sure both of you are clear on the loan terms before signing.

How To Get A Bad/No Credit Check Loan (Step By Step)

Having some knowledge of the loan process before you get started could help you get a better deal. Let’s go through some steps first to ensure you don’t pay more than you need to with a bad credit loan.

  • Begin by checking on your credit score and getting your credit report. Get your credit report to see if there are errors and look for places you can improve your score. If you locate any errors, get them fixed as this can improve your overall credit score and boost it up a few points. This could help you get a lower interest rate. By going to annualcreditreport.com, you can use the three major credit organizations to get your score.

When applying for a personal loan, the creditor uses your report to see if you can repay the loan. Ideally, you should check it three months before you apply for a loan, as this gives you the chance to fix any errors. Dispute them with all three bureaus for best results.

To improve your score, you should pay off a credit line that goes beyond 30% of its limit or pay a debt that has entered collections.

Determine your budget. First, find out how much you need to borrow. Next, devise a plan to make sure those payments are made on time. Make sure your budget accounts for your basic needs such as food, housing, and transportation, as well as credit card payments and savings.

As you figure out how much you can pay each month, think about the repayment period and amount. The longer you spend repaying the loan, the more you pay in interest. The monthly payment will be affected by the APR of the loan and whether the interest is variable or fixed. Make sure you take into account any loan fees as well (such as an origination fee, for example).

Shop and compare in order to save on interest. Getting a personal loan is not something you can do on a whim. Make sure you take the process seriously and take your time to find the best rate. Many online lenders can get you pre-approved, and these pre-approvals will show you what interest rate the lenders can offer.

Pre-approvals are essential quotes that are soft pulls on your credit report, designed to show you what interest rates are available for someone with your credit score. This is a great method of comparing bad/no credit loan interest terms and rates before applying (applying will trigger a hard pull on your credit report, which will affect your score).

You should aim to get pre-approvals from many lenders who do soft pulls on your credit. This will allow you to see what the best rates are and apply for the best one out there. This way,only one hard pull is done, and your score won’t get affected as much.

  • Watch out for fraud/scams. Many scammers exist and they want nothing more than to separate you from your money. It’s difficult to do, but remember, if something sounds way too good to be true, it probably is.

Any “lender” who asks you for fees upfront, contacts you non-stop, pays no mind to your payment history, requests that you pay using a prepaid credit card, or isn’t able to produce a license to loan money in your state is likely a scammer.

  • Pay back your loan. Some lenders will get you funded the next business day. After that money has been disbursed, you are responsible for paying it back.

Be sure to pay on time to avoid late fees and a lowered credit score. Paying after the due date means you will pay more in interest and pay more on your loan. It’s important that you work out the numbers ahead of applying to make sure you can pay it back on time, every time.

Alternatives to No Credit Check Loans

Bad and no-credit-check loans online are not inherently a bad thing, but they do come with their fair share of risks. It never hurts to check other, more conventional options first before you sign the paperwork for one. Here are some alternatives you might want to consider first.

Peer-To-Peer Lending

For these loans, individual investors fund your money instead of a large financial institution. You might end up with a better deal if you go with this option.

It works like any other loan, though – the better your credit score is, the better your interest rate will be. But it is virtually guaranteed that the terms will be better than payday loans, which come with a high-rate and many extra fees on the side.

What If You Don’t Qualify?

Some of you may not qualify for a bad credit loan. Or, you may have read this article and decided that it’s not for you at all. That’s OK. There are other ways you can go about making money to pay for what you need.

Call Your Company

If you’re in debt to a credit card company, a utility company, or somewhere else, call them to ask what options they can offer you.

You may be able to get onto a hardship plan which can help you reduce the interest charges and monthly payments. A utility company might allow you to pay half the bill and the other half in two weeks or next month, as an exception.

This could help you avoid taking a loan out in the first place.

Home Equity Line of Credit

Abbreviated as HELOC, this method lets you tap into the equity you’ve got in your home to get you some cash for what you need.

By applying for such a loan, you will be given a credit card or a check that you may use to cover your purchases during what’s called a ‘draw period.’ If you spend some of that money, you will have to make payments on the outstanding balance until the draw period comes to a close.

Afterward, this line of credit is converted into “repayment,” where you will repay any outstanding balance over time or at once, depending on the terms of your individual HELOC.

Look Over Your Budget Carefully

Try to find ways to cut back, if possible, to avoid taking out a small loan. Most people who get out of debt quickly do so by making EXTREME sacrifices in order to save every dollar toward getting out of debt.

This means absolutely no extras – no buying food or clothing unless it is absolutely necessary, no luxury/unnecessary spending, and no going out unless the activity is free or paid for by somebody else. It also means no cable TV, no Netflix, and in the most extreme of budgeters, no internet. You can google “Bare Bones Budget” for more info on that.

This may sound a bit harsh, but it does work and is a surefire way to climb out of debt.  For most of us, cutting back on extra expenses, such as not eating out as much, not shopping as much, and not buying items on impulse will be enough to help you get out of debt, as you will be using the money on what you need instead of spending it on unnecessary items.

You can also sell items you are not using to earn extra money. Online sales sites like Facebook Marketplace, Mercari, and eBay are all great places to help you raise some money.

Paycheck Advance

Not all employers can do this, but some will. You can get a cash advance on your paycheck. Again, this is dependent on each individual employer, but it’s worth a shot to see what they can do for you.

Side Hustle

Got some extra time on your hands? Get moonlighting with something you’re good at. Whether it’s delivering pizzas, making homemade handicrafts and selling them, doing freelance writing/artwork/video editing online, or something else that makes money safely and legally, get going. You might be tired after a long day at your primary job, but it’s a lot better than getting debt collection phone calls throughout the day.

Family and Friends

This one is one you should approach very carefully, as you do not want to damage your relationship with a friend or family member. Take it seriously and get it in writing, creating terms that you can stick with including due dates, interest, and payment amounts.

Treat it as if you were working with a bank. Alternatively, you might work to pay your debt off by offering childcare, labor, or another service to your loved one.

FAQs About No Credit Check Loans 

Q. Can I Get A Loan Without A Credit Check? 

Most lenders will be checking your score out to see if you qualify. But other lenders may opt to use different verification methods, such as bank information or artificial intelligence to come to a decision about whether or not to lend to you.

Q. Does Taking Out One of These Loans Affect My Score Since I Already Have Poor Credit history?

Anytime a person finalizes a loan application, their score is going to be affected. But, making on-time payments will help you rebuild that score. Make sure you do everything possible to pay your monthly payments on time (and consider paying a few bucks extra if you can afford it).

Q. Do You Know Of Any Bad Credit Loans That Have Guaranteed Approval?

Regardless of your score, there’s a high chance that some lender in the world is going to get you approved. That being said, you have to understand that such loans usually come with less than attractive loan terms and interest rates.

Q. What Are Some Example Loan Rates For Borrowers With Bad Credit? 

You can certainly find personal loans if your credit isn’t so great, we’ve seen people with scores of 450 get approved. However, the interest rates are usually a whopping 20% and up once your score goes below the “good” range.

Q. My Credit Is Not So Good. What Can I Do To Get A Loan? 

Your best bet is to go with a lender who utilizes alternative data to make decisions, such as your income or your banking history.

Q. I Need An Emergency Loan, But My Credit Is Bad. How Do I Get One? 

The lending companies we’ve gathered here can provide you with a loan. Choose the network that makes the most sense for you from the list and enters all applicable info. You will get offers from a multitude of different lenders, so choose the offer that you like best.

From there, you will fill out and finalize the application. It won’t take long to get your funds; Typically, you will get your money the next business day. Best of all, you can apply for these loans night and day thanks to the automated underwriting services used by these lenders.

Q. I Am Unemployed But Need An Emergency Loan. Am I Out Of Luck? 

Thankfully, the answer is no. Lenders are looking to see that you have adequate income to repay your loan. Therefore, those of you with income from rental properties, alimony, retirement pensions/accounts, government payments, or investments are all encouraged to apply. Even if you have income from an annuity, student aid, or child support, you should look into one of these loans if you need it but don’t have a traditional paycheck coming in.

Q. What Is The Minimum Credit Score Needed To Get A Loan? 

Lenders do not list such numbers on their website because they look at more factors than just your score to see if you qualify.

For instance, you might have a great credit score, but a lot of debt. If the lender feels that the potential borrower’s income is not going to cover the payments on another loan, they will reject the application.

Meanwhile, somebody could have a poor credit score but little to no debt. If that person has a monthly income that is sufficient to repay the loan, the lender will likely approve the application but include an origination fee and/or higher interest rate.

Lenders may look at your employment history as well. Stability is a good thing for lenders to see, and if you’ve been at the same workplace for a while and don’t frequently change jobs, you’ve got a good thing going. It means there aren’t gaps in your paychecks and that your income is steady.

Q. I Don’t Have Any Credit, What Is My Score?

If you have zero credit, your report will not show a score because there is not enough information available to create one.

This is called “credit invisibility,” and you will produce a score once you get your first loan or credit card and have 3-5 months of repayment history as reported to the three major bureaus. With a loan, your lender could report to all or just one of the credit bureaus.

In Conclusion: Which Is The Best Company For No Credit Check Loans? 

Now that you’ve learned the basics of bad or no credit check loans, will you be taking one out? If so, which service will you be using first?

Getting a loan is much easier now than it was in the old days. And, these online lenders already know that your credit is less than perfect, so there’s no need to have that somewhat embarrassing conversation with a bank or credit union.

Out of the above mentioned, we prefer platforms like MoneyMutual, BadCreditLoans, and CashUSA as the most trustworthy lenders.

Best of all, these are genuine lending outlets, so you don’t have to worry about scammers getting your personal information. Just make sure you formulate a plan to pay it back and make all the payments on time. Good luck!



Source link

Continue Reading

Bad Credit

Inside the Highly Profitable and Secretive World of Payday Lenders

Published

on

Illustration by Sarah Maxwell, Folio Art

When Bridget Davis got started in the family’s payday lending business in 1996, there was just one Check ’n Go store in Cincinnati. She says she did it all: customer service, banking duties, even painting walls.

The company had been established two years earlier by her husband, Jared Davis, and was growing rapidly. There were 100 Check ’n Go locations by 1997, when Jared and Bridget (née Byrne) married and traveled the country together looking for more locations to open storefront outlets. They launched another 400 stores in 1998, mostly in strip malls and abandoned gas stations in low-income minority neighborhoods where the payday lending target market abounds. Bridget drove the supply truck and helped select locations and design the store layouts.

But Jared soon fired his wife for committing what may be the ultimate sin in the payday lending business: She forgave a customer’s debt. “A young woman came to pay her $20 interest payment,” Bridget wrote in court documents last year during divorce proceedings from Jared. “I pulled her file, calculated that she had already paid $320 to date on a principle [sic] loan of $100. I told her she was paid in full. [Jared] fired me, stating, ‘We are here to make money, not help customers manage theirs. If you can’t do that, you can’t work here.’ ”

Photograph by Brittany Dexter

It’s a business philosophy that pays well, especially if you’re charging fees and interest rates of 400 percent that can more than triple the amount of the loan in just five months—the typical time most payday borrowers need to repay their debt, says the Pew Charitable Trusts, a nonprofit organization focused on public policy. Cincinnati-based Check ’n Go now operates more than 1,100 locations in 25 states as well as an internet lending service with 24/7 access from the comfort of your own home, according to its website. Since its founding, the company has conducted more than 50 million transactions.

What the website doesn’t say is that many, if not most, of those transactions were for small loans of $50 to $500 to working people trying to scrape by and pay their bills. In most states—including Ohio, until it reformed its payday lending laws in 2019—borrowers typically fork over more than one-third of their paycheck to meet the deadline for repayment, usually in two weeks. To help guarantee repayment, borrowers turn over access to their checking account or deposit a check with the lender. In states that don’t offer protection, customers go back again and again to borrow more money from the same payday lender, typically up to 10 times, driving themselves into a debt trap that can lead to bankruptcy.

Jared and Bridget Davis are embroiled in a nasty court battle related to his 2019 divorce filing in Hamilton County Domestic Relations Court. Thousands of pages of filings and 433 docket entries by April 26 offer the public a rare glimpse into the business operations of Check ’n Go, one of Cincinnati’s largest privately-owned companies, as well as personal lifestyles funded by payday lending.

The company cleared $77 million in profit in 2018, a figure that dipped the following year to $55 million, according to an audit by Deloitte. That drop in revenue may have something to do with the payday lending reform laws and interest rate caps passed recently in Ohio as well as a growing number of other states.


The day-to-day business transactions that provide such profit are a depressing window into how those who live on the edge of financial security are often stuck with few options for improving their situations. If a borrower doesn’t repay or refinance his or her original loan, a lender like Check ’n Go deposits the guarantee check and lets it bounce, causing the borrower to incur charges for the bounced check and eventually lose his or her checking account, says Nick DiNardo, an attorney for the Legal Aid Society of Greater Cincinnati. After two missed payments, payday lenders usually turn over the debt to a collection agency. If the collection agency fails to collect the full amount of the original loan as well as all fees and interest, it goes to court to garnish the borrower’s wages.

That devastating experience is all too familiar to Anthony Smith, a 60-year-old Wyoming resident who says he was laid off from several management positions over a 20-year period. He turned to payday lenders as his credit rating dropped and soon found himself caught in a debt trap that took him years to escape.

Two things happened in 2019, Smith says, that turned around his financial fortunes. First, he found a stable manufacturing job with the Formica Company locally, and then he took his mother’s advice and opened a credit union account. GE Credit Union not only gave him a reasonable loan to pay off his $2,500 debt but also issued him his first credit card in a decade. “I had been a member [of the credit union] for just two months, and I had a credit rating of 520. Can you imagine?” he says. Smith says he is now debt-free for the first time in 10 years.

Consumer advocates say Check ’n Go is one of the biggest payday lending operations in the nation. But knowing its exact ranking is difficult because most payday lending companies, including Check ’n Go and its parent company CNG Holdings, are privately held and reluctant to disclose their finances.

Brothers Jared and David Davis own the majority of the company’s privately held stock. David bought into the company in 1995, but CNG got its game-changing infusion of capital from the brothers’ father, Allen Davis, who retired as CEO of then-Provident Bank in 1998. Allen sold off $37 million in stock options and essentially became CNG’s bank and consultant.

By 2005, however, the sons were part of a public court battle against their father. Allen accused Jared and David of treating his millions in CNG stock as compensation instead of a transfer from his ex-wife (and the brothers’ mother), sticking him with a $13 million tax bill. In turn, the brothers accused Allen of putting his mistress and his yacht captain on the company payroll, taking $1.2 million in fees without board approval, and leading the company into ventures that lost Check ’n Go a lot of money. Several years of legal fighting later, the IRS was still demanding its $13 million. CNG officials did not respond to requests for comment for this story.

Jared and David split $22 million in profit from CNG in 2018 and, according to the Deloitte audit, CNG’s balance sheet showed another $42 million that could be split between the two brothers in 2019. Jared, however, elected not to receive his $21 million distribution “in order to create this artificial financial crisis and shelter millions of dollars from an equitable split between us,” according to Bridget’s divorce filing.

Worse, she claims, Jared said they would be responsible for paying taxes out of their personal accounts rather than from CNG’s company earnings, making her personally responsible for half of the $5.5 million in taxes for 2019. She believes it wasn’t happenstance that $5.5 million was wired to Jared’s private bank account in December of that same year. Bridget has refused to sign the joint tax return, and Jared filed a complaint with the court saying a late tax filing would cost them $1 million in penalties and missed tax opportunities.

“For the duration of our marriage and to the present, Jared has full and complete control of all money paid to us from various investments we have made in addition to our main source of income, CNG,” Bridget wrote in her motion. She suspects that Jared, without her knowledge or consent, plowed the money for their taxes and from other sources of income into Black Diamond Group, the fund that invests in the Agave & Rye restaurant chain. Beyond the original restaurant opened in Covington in 2018, “they have opened four other locations in one year,” she wrote, including Louisville and Lexington. (The ninth location opened in Hamilton this spring.) Agave & Rye’s website touts its Mexican fare as “a chef-inspired take on the standard taco, elevating this simple food into something epic!”

In his response, Jared wrote, “We have very limited regular sources of income.” He says he isn’t receiving any additional distributions from CNG, the couple’s primary source of income, “and this is not within my control. The company has declared that we would not make any further distributions in 2020 given economic circumstances. This decision is based on a formula and is not discretionary.” Agave & Rye helped produce $645,000 in income for Black Diamond in 2020 but has paid out $890,000 in loans, he says. Through August 31, 2020, he wrote, the couple’s “expenses have exceeded income from all sources.”


The divorce case filings start slinging mud when the couple accuses each other of breaking up their 22-year marriage and finding new partners. Jared claims Bridget began an affair during their marriage with Brian Duncan, a contractor she employed through her house flipping business. Bridget, he says, paid Duncan’s company $75,000 in 2018 as well as giving him a personal gift of $70,000 that same year. Jared says she also bought Duncan at least one car and purchased a house for him near hers on Shawnee Run Road for $289,000, then loaned money to Duncan. Jared says Duncan has been late in repaying the note.

While Bridget says Duncan has been drug-free for several years, he has a rap sheet with Hamilton County courts from 2000 to 2017 that runs five pages long. It lists a half-dozen counts of drug abuse and drug possession, including heroin and possession of illegal drug paraphernalia; assaulting a police officer; stealing a Taser from a police officer; criminal damaging while being treated at UC Health; more than a dozen speeding and traffic violations; a half-dozen counts of driving with a suspended license; receiving stolen property; twice fleeing and resisting arrest; three counts of theft; two counts of forgery; and one count for passing bad checks.

Bridget has fired back that Jared not only is hiding his money from her but spending it lavishly on vacations, resorts, and high-end restaurants with his new girlfriend, Susanne Warner. Bridget says Jared gifted Warner with $40,000 without Bridget’s knowledge, then declared it on their joint tax return as a “contribution.” Bridget’s court filings include photocopies of social media posts of Jared and Warner globetrotting from summer 2019 to summer 2020: vacation at Beaver Creek Village in Avon, Colorado; cocktails at High Cotton in Charleston, South Carolina, and dinner at Melvyn’s Restaurant and Lounge in Palm Springs, California; getaways at resorts in Nashville and at a lakefront rental on Norris Lake ($600 per night); in the Bahamas at a Musha Cay private residence ($57,000 per night), at South Beach in Miami, and at a private beach at Fisher Island; in Mexico at Cabo San Lucas; in the U.S. Virgin Islands at Magen’s Bay and on a private yacht ($4,500 per night); in California at Desert Hot Springs, the Ritz-Carlton in Rancho Mirage, and Montage at Laguna Beach; and in the Bahamas at South Cottage ($2,175 per night).

For her part, Bridget has gone through some of the top lawyers in town faster than President Trump during an impeachment—six in all, two of whom she’s sued for malpractice. She sent four binders of evidence to the Ohio Supreme Court, asking for the recusal of Hamilton County Judge Amy Searcy and claiming Searcy was biased because of campaign donations from Jared and his companies. Rather than deal with the list of questions sent to her by Chief Justice Maureen O’Connor, Searcy stepped down. Two other judges have since stepped into the fray, and in March Bridget filed for a change of venue outside of Hamilton County, arguing she can’t get a fair trial in her hometown. At press time, a trial date had been set for June 28 in Hamilton County.

The poor-mouthing in the divorce case has reached heights of comic absurdity. Jared claims he’s “illiquid” because he didn’t get his distribution from CNG in 2019. Bridget has received debt collection notices for the nearly $21,000 owed on her American Express card and a $735 bill from Jewish Hospital. There’s no sign yet that anyone is coming to repossess her Porsche, which according to her filings has a $5,000 monthly payment. Each party has received $25,000 a month in living expenses, an amount later reduced to $15,000 under a temporary legal agreement while the divorce case is being sorted out. Court filings show that Jared’s net worth is almost $206 million and Bridget’s is $22.5 million.


In the early 1990s, Allen Davis was raising eyebrows at Provident Bank (later bought by National City), and not only because of his very unbanker-like look of beard, ponytail, and casual golf wear. He was leading the company into questionable subprime home loans for people with bad credit and a frequent-shopper program for merchants, though the bank’s charter barred him from getting involved in full-blown predatory lending practices. With guidance and funding from his father, Jared, at age 26, launched Check ’n Go in 1994 and became a pioneer in the payday lending industry. Jared and his family saw there were millions of Americans who didn’t have checking or savings accounts (“unbanked”) or an adequate credit rating (“underbanked”) but still needed loans to meet their everyday expenses. What those potential customers did have was a steady paycheck.

Conventional banks share a big part of the blame for the nation’s army of unbanked borrowers by imposing checking account fees and onerous penalties for bounced checks. In 2019, the Federal Deposit Insurance Corporation estimated there were 7.1 million U.S. households without a checking or savings account.

The Davises launched Check ’n Go on the pretext that it would “fill the gap” for people who occasionally needed to borrow money in a hurry—a service for those who couldn’t get a loan any other way. But consumer advocates say the real business model for payday lending isn’t a service at all. The majority of the industry’s revenue comes from repeat business by customers trapped in debt, not from borrowers looking for a quick, one-time fix for their financial troubles.

Ohio’s payday lending lobbyists got a strong hold on the state legislature in the late 1990s, and by 2018 Democratic gubernatorial candidate Richard Cordray could rightfully claim in a campaign ad that “Ohio’s [payday lending] laws are now the worst in the nation. Things have gotten so bad that it is legal to charge 594 percent interest on loans.” His statement was based on a 2014 study by the Pew Charitable Trusts.

The frustration for consumer advocates was that Ohioans had been trying to reform those laws since 2008, when voters overwhelmingly approved a ballot initiative placing a 28 percent cap on the interest of payday loans. But—surprise!—lenders simply registered as mortgage brokers, which enabled them to charge unlimited fees.

The Davis family and five other payday lending companies controlled 90 percent of the market back then, an express gravy train ripping through the poorest communities in Ohio. The predatory feeding frenzy, especially in Ohio’s hard-hit Rust Belt communities, prompted a 2017 column at The Daily Beast titled, “America’s Worst Subprime Lender: Jared Davis vs. Allan Jones?” (Jones is founder and CEO of Tennessee-based Check Into Cash.) In 2016 and 2017, consumer advocates mustered their forces again, and this time they weren’t allowing for loopholes. The Pew Charitable Trusts joined efforts with bipartisan lawmakers and Ohioans for Payday Loan Reform, a statewide coalition of faith, business, local government, and nonprofit organizations. Consumer advocates found a legislative champion in State Rep. Kyle Koehler, a Republican from Springfield.

It no doubt helped reform efforts that former Ohio Speaker of the House Cliff Rosenberger resigned in spring 2018 amid an FBI investigation into his cozy relationship with payday lenders. Rosenberger had taken frequent overseas trips—to destinations including France, Italy, Israel, and China—in the company of payday lending lobbyists. In April 2019, Ohio’s new lending law took effect and, since then, has been called a national model for payday lending reform that balances protections for borrowers, profits for lenders, and access to credit for the poor, according to the Pew Charitable Trusts. New prices in Ohio are three to four times lower for payday loans than before the law. Borrowers now have up to three months to repay their loans with no more than 6 percent of their paycheck. Pew estimates that the cost of borrowing $400 for three months dropped from $450 to $109, saving Ohioans at least $75 million a year. And despite claims that the reforms would eliminate access to credit, lenders currently operate in communities across the state and online. “The bipartisan success shows that if you set fair rules and enforce them, lenders play by them and there’s widespread access to credit,” says Gabe Kravitz, a consumer finance officer at the Pew Charitable Trusts.

Other states like Virginia, Kansas, and Michigan are following Ohio’s lead, Kravitz says. Some states, such as Nebraska, have even capped annual interest on payday loans. As a result, Pew researchers have seen a reduction in the number of storefront lending op­erations across the country. Even better, Kravitz says, there’s no evidence that borrowers are turning instead to online payday lending operations.

Cincinnati is one of five cities chosen for a grant to replicate the success of Boston Builds Credit, an ambitious effort that city launched in 2017 to provide credit counseling in poor and minority communities by training specialists at existing social service agencies. The program also encourages consumer partnerships with credit unions, banks, and insurance companies to offer small, manageable loans that can help the unbanked and underbanked improve their credit ratings. “Right now, local organizations are all kind of working in silos on the problem in Cincinnati,” says Todd Moore of the nonprofit credit counseling agency Trinity Debt Relief. Moore, who applied for the Boston grant, says he’s looking for an agency like United Way or Strive Cincinnati to lead the effort here.

Anthony Smith is thankful that he’s escaped the downward spiral of his payday loans, especially during the pandemic’s economic turmoil. “I’m blessed for every day I can get paid and have a job during these difficult times, just to be able to pay my bills and meet my responsibilities,” he says. “I’ve always kept a job, but until now I’ve had crappy credit. That doesn’t mean I’m a bad guy.”

Can others worth millions of dollars say the same?

Inside the Highly Profitable and Secretive World of Payday Lenders Source link Inside the Highly Profitable and Secretive World of Payday Lenders



Source link

Continue Reading

Bad Credit

What’s Questionable Credit and Can I Get a Car Loan With It?

Published

on

Questionable’s definition means that something’s quality is up for debate. If a lender says that your credit score is questionable, it’s likely that they mean it’s poor, or at the very least, they’re hesitant to approve you for vehicle financing. Here’s what most lenders consider questionable credit, and what auto loan options you may have.

Questionable Credit and Auto Lenders

Many auto lenders may consider questionable credit as a borrower with a credit score below 660. The credit score tiers as sorted by Experian the national credit bureau, are:

  • Super prime: 850 to 781
  • Prime: 780 to 661
  • Nonprime: 660 to 601
  • Subprime: 600 to 501
  • Deep subprime: 500 to 300

The nonprime credit tiers and below is when you start to get into bad credit territory and may struggle to meet the credit score requirements of traditional auto lenders.

This is because lenders are looking at your creditworthiness – your perceived ability to repay loans based on the information in your credit reports. Besides your actual credit score, there may be situations where the items in your credit reports are what’s making a lender question whether you’re a good candidate for an auto loan. These can include:

  • A past or active bankruptcy
  • A past or recent vehicle repossession
  • Recent missed/late payments
  • High credit card balances
  • No credit history

There are ways to get into an auto loan with questionable credit. Your options can change depending on what’s making your credit history questionable, though.

Questionable Credit Auto Loans

If your credit score is less than stellar, it may be time to look at these two lending options:

  • What Is Questionable Credit and Can I Get a Car Loan With It?Subprime financing – Done through special finance dealerships by third-party subprime lenders. These lenders can often assist with many unique credit situations, provided you can meet their requirements. A great option for new borrowers with thin files, situational bad credit, or consumers with older negative marks.
  • In-house financing – May not require a credit check, and is done through buy here pay here (BHPH) dealers. Typically, your income and down payment amount are the most important parts of eligibility. Auto loans without a credit check may not allow for credit repair and may come with a higher-than-average interest rate.

Both of these car loan options are typically available to borrowers with credit challenges. However, if you have more recent, serious delinquencies on your credit reports, a BHPH dealer may be for you. Most traditional and subprime lenders typically don’t approve financing for borrowers with a dismissed bankruptcy, a repossession less than a year old, or borrowers with multiple, recent missed/late payments.

Requirements of Bad Credit Car Loans

In many cases, your income and down payment size are the biggest factors in your overall eligibility for bad credit auto loans. Expect to need:

  • 30 days of recent computer-generated check stubs to prove you have around $1,500 to $2,500 of monthly gross income. Borrowers without W-2 income may need two to three years of professionally prepared tax returns.
  • A down payment of at least $1,000 or 10% of the vehicle’s selling price. BHPH dealers may require up to 20% of the car’s selling price.
  • Proof of residency in the form of a recent utility bill in your name.
  • Proof of a working phone (no prepaid phones), proven with a recent phone bill in your name.
  • A list of five to eight personal references with name, phone number, and address.
  • Valid driver’s license with the correct address, can’t be revoked, expired, or suspended.

Depending on your individual situation, you may need fewer or more items to apply for a bad credit auto loan. However, preparing these documents before you head to a dealership can speed up the process!

Ready to Get on the Road?

With questionable credit, finding a dealership that’s able to assist you with an auto loan is easier said than done. Here at Auto Credit Express, we want to get that done for you with our coast-to-coast network of special finance dealerships.

Complete our free auto loan request form and we’ll get right to work looking for a dealer in your local area that can assist with many tough credit situations.

(function(d, s, id){ var js, fjs = d.getElementsByTagName(s)[0]; if (d.getElementById(id)) {return;} js = d.createElement(s); js.id = id; js.src = "http://connect.facebook.net/en_US/sdk/debug.js"; fjs.parentNode.insertBefore(js, fjs); }(document, 'script', 'facebook-jssdk'));

Source link

Continue Reading

Bad Credit

Entrepreneur Tae Lee Finds Her Fortune

Published

on

By Jasmine Shaw
For The Birmingham Times

Birmingham native Tae Lee had plans last year to visit the continent of Africa, the South American country of Columbia, and the U.S. state of Texas.

“I was going to stay in each place for like four to six weeks, and then COVID-19 happened,” she said. “So, I just was like, ‘You know what, I’m just gonna go to Mexico and stay for six months.’”

Once home from Playa Del Carmen, located on Mexico’s Yucatán Peninsula, the 33-year-old entrepreneur put the final touches on “Game of Fortune: Win in Wealth or Lose in Debt,” a financial literacy card game for ages 10 and up.

“We created ‘Game of Fortune’ because we realized there was a gap in learning the fundamentals of money,” said Lee. “We go through life not knowing anything about money and then—‘Bam!’—real life hits. Credit, debt, and bills come at us quick!”

Lee believes the game “gives players a glimpse of real life” by using everyday scenarios to teach them how to make wiser financial decisions without having to waste their own money.

“I feel like [financial literacy] can be learned in ways other than somebody standing up and preaching it to you over and over again,” she said. “You can learn it in ways that are considered fun, as well.”

Which is why “we want the schools to buy it, so we can give students a fun way to learn about financial literacy,” she added.

Lee, also called the “Money Maximizer,” is an international best-selling financial author, speaker, coach, and trainer who is known for her financial literacy books, including “Never Go Broke (NGB): An Entrepreneur’s Guide to Money and Freedom” and the “NGB Money Success Planner High School Edition.” The Birmingham-based financial guru focuses on creating diverse streams of income in the tax, real estate, insurance, and finance industries.

For Lee, it’s about building generational wealth, not debt.

Indispensable Lessons

Lee got her first glance at entrepreneurial life as a child watching her mother, Valeria Robinson, run her commercial cleaning company, V’s Cleaning. Robinson retired in 2019.

“My grandmother had a cleaning service, too,” said Lee. “So, even though I didn’t start out as an entrepreneur, watching my mom and grandma do it taught me a lot.”

Lee grew up in Birmingham and attended Riley Elementary School, Midfield Middle School, and Huffman High School. She then went on to Jacksonville State University, in Jacksonville, Alabama, where she earned bachelor’s degree in physical education. She struggled to find a career in her field and became overwhelmed by student loans.

“My credit and stuff didn’t get bad until after college,” she said. “I was going through school and taking money, but nobody told me, ‘Oh, you’re gonna have to pay all of this back.’”

Before embarking on her extensive career in money management, Lee had not learned the indispensable lessons that she now shares with clients.

“‘Don’t have bad credit.’ That’s all I learned,” she remembers. “Financial literacy just wasn’t taught much. I learned the majority of my lessons as I aged.”

In an effort to ward off collection calls and raise her credit score, Lee researched tactics to strategically eliminate her debt.

“I knew I had to pay bills on time, and I couldn’t be late with payments,” she said.

Lee eventually began helping friends revamp their finances and opened NGB Inc. in 2017 to share fun, educational methods to help her clients build solid financial foundations.

“People were always coming to me like, ‘How do I invest in this?’ and ‘How do I do that?’ So, I said to myself, ‘You know what, people should be paying to pick your brain.’”

Legacy Building

While Lee enjoyed watching her clients reach milestones, like buying a new car with cash or making their first stock market investment, she was also designing “Game of Fortune” to teach the value of legacy building.

“The game gives players the knowledge to build generational wealth, not generational debt,” she said. “It gives you a glimpse of life, money, and what can truly happen if you mismanage your coins.”

Using index cards to create her first “Game of Fortune” sample deck, Lee filled each card with pertinent terms related to debt elimination and credit and wealth building. She then called on a few friends to help her work through the kinks.

Three of her good friends—Barbara Bratton, Daña Brown, and Sha Cannon—were just a few of the people that gave feedback on the sample deck.

“From there I met with Brandon Brooks, [owner of the Birmingham-based Brooks Realty Investments LLC], and four other financial advisors to fine-tune the definitions and game logistics,” Lee said.

Though Lee was unable to land a job in physical education after graduating from college, she now sees her career with NGB Inc. as life’s unexpected opportunity to teach on her own terms.

“Bartending and waitressing taught me that working for someone else was not for me,” she replied. “In order to get the life I always wanted, I had to create my own business.”

In her entrepreneurial pursuits, Lee strives to be an open-minded leader who embraces the need for flexibility.

“COVID-19 has shown me that in entrepreneurship you have to maneuver,” she said. “When life changes, sometimes your business will, too. You may have to change the path, but your ending goal can be the same.”

“Game of Fortune: Win in Wealth or Lose in Debt” is available and sold only on the “Game of Fortune” website: gameoffortune.money. To learn more about Tae Lee and Never Go Broke Inc., visit taelee.money and nevergobroke.money or email tae@taelee.money; you also can follow her on Facebook (https://www.facebook.com/nevergobrokeinc) and Instagram (@nevergobrokeinc).

Source link

Continue Reading

Trending