If a company states that there is no credit check carried out on an application then this is false 100%. Any lender looking to enter into a car loan contract with a customer is going to require a credit check to be completed even if its purpose is to confirm the identity of the applicant. What many customers who approach MSG Cars are confused of is what exactly a Credit Check is for and how a Non Prime lenders search differs from a Mainstream funders. With a specialist Bad Credit company a search is tailored to their own specific requirements and so they expect customers to have a lower score than the average as this is the segment of the industry they operate. With a financial institution such as a Bank they will have a much higher bar set than the Sub Prime and so when they search your credit file they will normally decline the case if they see ANY Bad Credit over the 6 year period – thats it! Now a Non Status type of lender will be looking for the customer to fit one of several profiles and the repayment rate issued will depend on the severity of the problems. This means that we can take an application for a Car Loan from a customer and still be able to usually give them the instant decision favored by the Prime companies.
There are other reasons that it would be very difficult to offer No Credit Check Car Loans also and this is related to possible fraud and or identity theft. By carrying out a search it is possible in an instant to confirm the details the customer has provided such as date of birth, full name and address history. In making a decision on a Car Loan application the Credit File will show all addresses used for finance for a particular customer and so help to confirm there identity and also show that they are either a person that has always been honest and not dissapeared from the system while avoiding repaying there debts.The customers electorall roll history will show alongside there active or expired finance agreements and it helps give the lenders peace of mind when making quick decisions as to wether the customer will dissapear with the new Car purchased with the loan.
Other issues that come arise if No Credit check Car Loan was carried out would be factors such as a customer having several cars repossesed over the years and then applying for another one. If our lenders took this approach to business then the pattern of likely default wouldn’t be spotted and it could see considerable resources used up lending to customers that have a track record of failing to pay for their car finance and car loans.If this was the case it wouldn’t be long until we had no funders left as you will always get some customers that just simply wouldn’t repay.