Best loans for no credit history of November 2024

Many loans cater to borrowers with no credit history, but some are much better than others. Generally speaking, lenders that don’t check your credit offer loans with high fees, low amounts, and short repayment terms — think payday loans and title loans. These are the loans you want to avoid.

Instead, consider personal loans, credit-builder loans, payday alternative loans (PALs), certain cash advance apps, and “buy now, pay later” services. Each can be an affordable borrowing option if you have no credit history.

Best loans for no credit history

The best loan with no credit history is arguably a personal loan — if you can get one. This is because annual percentage rates (APRs) typically top out around 36%, you generally have years to pay the money back, and monthly payments are fixed (meaning they won’t change).  

Plus, personal loan amounts are available in the thousands-of-dollars range, unlike loans that don’t require a credit check, and a history of consistent, on-time payments can help you build credit.

But most lenders have a minimum credit score requirement and prefer to see a positive payment history on your credit report, which can make it difficult to qualify. 

Applying with a cosigner with good credit can help. Alternatively, you can apply with a lender that doesn’t have a minimum credit score requirement (but you may need to apply directly on the lender’s website).

No-credit-history lenders and loans with cosigners

Methodology

We evaluated the best personal loan lenders for no credit history loans based on factors such as customer experience, minimum fixed rate, maximum loan amount, funding time, loan terms, fees, discounts, and whether cosigners are accepted. 

Our team of experts gathered information from each lender’s website, and customer service department, directly from our partners, and via email support. Each data point was verified by a third party to make sure it was accurate and up to date.

Read our full lender rating methodology for more information.

How to get a loan with no credit history

Lenders use your credit history as a metric when assessing your credit profile. With no credit score or history, you can appear riskier to lenders and may have limited borrowing options. Here’s how to get a loan with no credit history:

1. Research your options: Find reputable lenders that don’t require a credit score or lenders that allow cosigners. A cosigner is someone with good credit who can help you get approved by a lender. But if you default, they’re on the hook for paying back the loan. And even late payments on your part can hurt their credit.
2. Prequalify: Many lenders offer a prequalification process, which can help you get a sense of whether you’ll be approved for a loan, and the rate you might get. The process usually involves entering some personal information, like your name, date of birth, and Social Security number. It doesn’t impact your credit, but it’s not an offer of credit. The final rate you receive may be different.
3. Compare multiple lenders: Compare factors such as the APR, loan amount, repayment terms, and time to fund. Some lenders may also charge an origination fee, which can range from 1% to 12% of the loan amount and is usually deducted before you receive your funds.
4. Submit an application: Fill out a full application once you’ve chosen a loan. Once you formally apply, the lender will perform a hard credit inquiry, which can ding your score temporarily (if you have a credit score). If you apply with a cosigner, they’ll need to provide their information as well. The lender will pull their credit, which could temporarily lower their score as well.
5. Get your funds: If approved, expect to receive money within a few business days. Some lenders can fund loans the same day you’re approved; others may take up to a week.

Learn more: How to get a personal loan

Other no-credit-history loans

These loans are designed for borrowers that have no credit or bad credit. As such, lenders offering them may or may not check your credit.

Payday alternative loans (PALs)

If you are a member of a federal credit union that offers them, consider a PAL. These loans are designed as affordable alternatives to payday loans. Interest rates are capped at 28%, and there’s no minimum credit score requirement. Credit unions may offer one or both types of PALs:

• PALs I offer amounts ranging from $200 to $1,000, with repayment terms up to six months. To be eligible, you must be a member of a credit union for at least one month.
• PALs II offer loan amounts up to $2,000, and repayment terms from one to twelve months. You must be a credit union member to qualify, but no waiting period is required.

Credit-builder loans

A credit-builder loan doesn’t require an established credit history or score and can be available in amounts up to $3,000. However, you only get access to the money once you pay off the loan. You can find credit-builder loans from online lenders, banks, and credit unions.

This type of loan is designed to help people with no credit score establish a credit score and history. Unlike a traditional loan, where you receive the money upfront, the money from a credit-builder loan is put into a savings or certificate of deposit (CD) account.

Each month, you make a payment to pay back the loan, plus interest. Depending on the lender, APRs can range from around 5% to 16% or more.

Your lender will report your payments to one or multiple credit bureaus each month. If you make payments on time, this can help build a positive payment history.

“Buy now, pay later” services

If you’re looking to fund a specific purchase but don’t have a credit history, you may be able to obtain financing through a buy now, pay later service (BNPL). These loans are available through certain retailers at checkout, online, in-store, or through apps. BNPL allows you to split an eligible purchase into smaller installments, such as four payments every two weeks, which may or may not come with interest.

The impact using this type of financing has on your credit varies by plan and service, as well as how you manage the loan. Some BNPL providers/plans only require a soft credit check, which won’t hurt your score, while others may require a hard pull, which can lower it a few points. And some may not check your credit at all. Whether BNPL lenders report your payments to credit bureaus also varies. Be sure to review terms, possible fees, and any borrowing costs before taking out a BNPL loan.

No-credit-check loans

While no-credit-history loans may still check your credit as a matter of course, there are some loans that skip a credit check altogether. These loans often have much higher APRs and fees, offer smaller loan amounts, and have short repayment terms.

Cash advance apps

Cash advance apps provide quick access to small amounts of money (sometimes up to $500 or more, though this varies between apps) to bridge the gap between paydays. Money is deposited and removed from your linked bank account, and you are expected to pay back the money with your next paycheck. What you qualify for is generally based on the activity in your linked account and how long you’ve used the app for.

While cash advance apps can be much cheaper than payday loans, some have mandatory and optional fees that can make them just as expensive. For instance, Earnin offers fee-free advances up to $750 per pay period. That’s a 0% APR, which is hard to beat. However, if you pay a $4 fast funding fee for a $100 advance, and leave a $1 tip, that’s a 130% APR.

Payday loans

Payday loans are short-term, high-fee loans designed to appeal to people with no credit or bad credit. Like a cash advance app, payment is often due on your next payday, and loan amounts typically top out at $500. Unlike a cash advance app, you’ll generally pay between $10 and $30 per $100 borrowed, which can make payday loans obscenely expensive.

For example, a $200 payday loan with a $20 fee and two-week repayment term translates to a 261% APR.

If you can’t repay on time, some payday loan lenders let you renew the loan for additional fees, which can lead to even higher APRs, and a debt cycle that’s difficult to escape.

No-credit-history loans FAQ

How to build credit with no credit history

If you don’t have a credit history, becoming an authorized user on a credit card is one way to start building one. Consistent, on-time payments on a personal loan could also boost your score. If you can’t qualify for a personal loan on your own, a cosigner with strong credit and income can help you get approved. Another option is to consider a credit-builder loan. You don’t get access to the funds until you’ve paid off the loan in full, but the payments you make are reported to at least one credit bureau.

How can I borrow money with no credit?

To borrow money with no credit, you could consider no-credit-check loans. These can provide you with fast access to cash, but also may come with high APRs and fees. A cosigned personal loan may also be an option. A cosigner is someone with good credit who can help you get approved for a loan, but also becomes responsible for paying it back if you don’t. 

Payday alternative loans, meanwhile, may be an option if you’re a member of certain federal credit unions. And if you have your eyes on a specific purchase, you may be eligible to use a buy now, pay later service to split the cost into smaller installments, possibly without interest.

Where can I borrow money with no credit?

While having no credit history limits your borrowing options, there are personal loan lenders that don’t have a minimum credit score requirement. You’re unlikely to access their highest loan amounts or lowest rates, however. If you’re a member of a federal credit union, you can ask about payday alternative loans, which have APRs capped at 28%. 

You could also use a buy now, pay later service to split up a purchase into installments, or download a cash advance app to access a portion of your next paycheck. Just be sure to compare overall borrowing costs, including interest rates and any possible fees, between options, and consider whether you’ll be able to comfortably fit any payments into your budget for the full length of the term.

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