If you are desperately in need of a large sum of money to clear your unsettled debt, you would probably turn your head on instant loans online as your loan application would not be accepted by many financial institutions because of your bad credit record. Hence, you are at a financial crossroad as you are unable to perform your financial duties that could affect your family and working life.

It appears that there are a handful of private lenders who are offering personal loans without credit check and verification of income. What is the logic behind those lenders who are willing to grant substantial amount of loans to borrowers who have low credit scores and low salaries (or maybe currently unemployed)?

Loan lending business is indeed a competitive business industry after the recent financial crisis which has affected the world especially the U.S., as many Americans had to succumb to unemployment and debt issues. Most traditional financial institutions are very particular on their applicants' financial status before they start granting loans to them. Therefore, getting loans from private lenders is a current fad for those borrowers who have extremely low credit score and have meager incomes.

For that reason, the actual cost of bad credit personal loans is higher than other regular loans which are offered by traditional financial institutions. It is mainly because of the high interest rate applied to the bad credit loans as private lenders have to bear the risk of having those "inefficient" borrowers who are unable to repay their loans as agreed. Unless the borrower has put up collateral for a loan - for instance, using his home or car as collateral, he can request for an interest rate deduction in which it can lowers the cost of the loan.

Since loan lending business is a lucrative industry, many private lenders attract their potential borrowers by accepting loan application online. It is common to see their marketing approach implying that they are offering loans with no credit check and no income verification. Such loan deals are simply irresistible to most financially weakened loan seekers with low credit scores. In fact, such loan packages are referring to co-signer personal loans.

It is true that a co-signer personal loan does not require any credit check and income verification on the applicants - but it's on the co-signer. Thus, it is important that the co-signer must have good credit score and a stable income. By the way, the approval of the loan amount is based on the total salary earned by the co-signer - that explains why some borrowers are granted with larger loan amount while others don't.

If any lenders strongly convince their applicants that they are offering no-credit check personal loans in which it does not require any verification of income - it could be a trick that often used by scam artists. Hence, you need to apply for such loans from Better Business Bureau (BBB) accredited private lenders.