Types of loans you can get without a bank account
It can sometimes be difficult to find a loan when you do not possess a bank account. However, there are loans available to you if you are unbanked. It is a good idea to familiarize yourself with these loans before you need them so that you will know where to find the money you need in the event of an emergency.
Car Title Loans
This is one of the easiest loans to obtain when you do not have a bank account. This is because lenders favor situations where they are not at risk of receiving no compensation if the borrower defaults on the loan. Companies that give title loans will often only want to see a clear car title and a verifiable income before disseminating loan funds. It is important to remember that your car’s title is the collateral and not the vehicle itself. This means there will be no disruption in your ability to use the car as you repay the loan.
Short-Term Cash Advance
These personal loans typically have terms of six months or less. Some of these loans allow borrowers to pay a single lump sum repayment at the end of the loan term that includes the principle and interest paid on the loan. Companies that give short-term personal loans usually want you to have a bank account but there are times when they are willing to waive this requirement. However, this benefit often comes with higher interest rates and added fees.
Pawn Shop Loan
A loan from a pawnshop will allow you to use items you own as collateral to receive a short-term loan. Typically, a loan shop will give you 25 to 60 percent of the resale value of the item you bring to the shop. Loan terms are usually from one to three months and interest rates are typically higher than some other types of loans. Pawnshop loans usually offer better rates than car title and payday loans. The exact interest rate you pay will depend on your state of residence and the deal you negotiate with the pawnshop.
A payday loan is often the answer for people who need emergency cash between paychecks, but do not have good credit or a bank account. These loans are generally an advance on your next paycheck and should be repaid then. You are sometimes allowed to extend the loan term if you need to, but will typically incur more fees to do so. The payday loan process is easy and convenient to complete, and the entire process can be done online. If approved, funds can be paid in as little as one business day, which is so important if you have an emergency situation and are short on cash. You can start by googling payday advance online and comparing the companies to find one that fits what you’re looking for.
Bitcoin loans represent one of the newer loans on the market. These loans are obtained on peer to peer lending platforms. Once investors approve you for the loan, they provide the funding and wait for your repayments. These loans can be funded within hours but there are a few risks to keep in mind. The fluctuating value of bitcoin is chief among these concerns. You can actually end up paying considerably more back than you borrowed if the value of bitcoin increases significantly in value during your repayment term. It is suggested that you have some understanding of the bitcoin market before accepting one of these loans.
Peer to Peer Loans
Peer to peer loans oftentimes does not require a bank statement because they originate from individuals. These individuals can also include family and friends. If the person does not know you well, they may ask for proof of income to ease any concerns they have about your ability to repay the loan. There are many peer to peer lending platforms online and you should check the terms and requirements of each network before signing a loan contract.
The Bottom Line
It is not an easy thing to find the loan you need when you do not possess a bank account. However, with a little persistence, you can find a loan that will see you through the rough time you are experiencing. The six potential loan sources above should be considered by unbanked individuals who need a loan.