Why do people look for a lender who doesn’t do credit checks? The answer is – “it’s complicated”. There’s likely to be several reasons with the most significant one being the borrower has a poor credit history for things that have happened in the past and they don’t want to be refused a loan application. Most lenders try to steer clear of such borrowers because the risk is high they will default. The only recourse remaining is to use payday loan lenders who charge higher interest rates

Another reason some people chose to apply for a payday loan in New Zealand with no credit checks is they don’t want the application for a loan recorded on their credit file. Most credit bureaus record loan applications and then take these into account when determining a credit score. A person who applies for lots of loans over a short period will have their credit score down-graded, especially if it’s for a payday loan.

In spite of these reasons, Acorn Finance recommends all loan applicants undergo a credit check – it’s in their interest as well as being useful to the lender. For lenders, credit checks help confirm the identity of applicants, especially in the case of online loans. Furthermore, lenders have a legal responsibility to make sure the loan is suitable for the borrower and not to lend if it’s likely to cause harm to the borrower. So, for a responsible lender, credit checking is good practice.Acorn Finance does credit checks on loan applicants. The results are only part of the applicant review consideration. More emphasis is placed on information extracted from recent bank statements such as regular pay, the number of other loans (if any), and any payment defaults. See how it works.

So don’t worry if your credit score is not the best, it probably won’t hold you back from getting a loan from Acorn Finance.

New Zealand has specific laws covering consumer credit such as loans, credit cards and hire purchase. These laws are administered by the Commerce Commission who have provided useful guidelines for both lenders and borrower. Check it out here. It’s worthwhile taking a few minutes to read this information if you are considering a loan. 

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