Can you get a loan with a poor credit score? The answer is yes. What should you know about non-TU loans? Many Hongkongers facing cash flow problems turn to banks or financial institutions for loans. However, due to their low credit scores, those with poor credit history or past bankruptcies often find it challenging to secure personal loans. But there is hope.
Financial institutions like CreFIT and Grantit offer a lifeline in the form of ‘non-TU loans.’ These loans are designed to empower individuals with low TU scores, providing them with the means to meet their financial needs. This article equips you with the knowledge to confidently secure a genuine TU-free loan online, giving you control over your financial situation.
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Features of Non-TU Loans
When applying for personal loans, besides submitting income proof, address proof, and identification documents, loan providers typically review the borrower’s credit report to determine the loan amount, annual percentage rate (APR), and other terms.
TU credit scores are a crucial indicator for banks when approving loans. Applicants with a TU score of grade G or lower find getting loans from major banks challenging.
Some financial companies have introduced a significant change in the lending industry-non-TU loans. These loans, unlike traditional ones, do not require a review of the applicant’s credit report. This means that individuals with low credit scores, poor credit history, or past bankruptcies can now apply for loans without the fear of rejection based on their credit scores.
Factors Affecting Credit Scores
- Repayment history
- Credit inquiry history
- Credit utilization ratio
- Length of credit history
- Types of credit accounts (including the number of credit cards)
Repayment history has the most significant impact on your credit score. Delayed payments, outstanding credit card balances, or being in bankruptcy can severely lower your credit score.
Considerations for Borrowing Non-TU Loans in Hong Kong
Borrowing with a poor TU score is not impossible, but the interest rates will inevitably be higher. Additionally, you should consider the following points:
- Avoid Unreliable Lenders: Currently, only financial companies offer non-TU loans. Unlike banks that are strictly regulated, the quality of financial companies can vary. Their debt collection practices may cause harassment to borrowers and their families. Therefore, conduct thorough research to ensure you are dealing with a legitimate financial institution and always repay on time.
- Reputable Lenders Also Offer Non-TU Loans: It is a misconception that only second—or third-tier financial companies offer non-TU loans. Many emerging loan platforms and FinTech startups use big data and AI to approve loans without checking credit reports. Thus, not only do unreliable money lenders provide non-TU loans, but reputable lenders also offer these TU-free lending services.
- Improve Personal Finance Management Habits: For those with very low credit scores who urgently need extra cash, non-TU loans or TU-Free loans can be a lifesaver. However, if the need arises from overspending, recognize that this is not a long-term solution. Cultivating a habit of saving can improve your financial situation.
Frequently Asked Questions about Non-TU Loans
You can obtain a personal credit report from three companies in Hong Kong. You can purchase a credit report directly from the TransUnion website or visit their office in person. Additionally, you can check your credit report through NOVA PASS and PAOCCRA.
If your credit application (including credit cards, loans, or mortgages) is rejected by a bank or financial institution checking your credit report, you will receive a rejection letter. Follow the instructions in the rejection letter to get a free credit report from the credit report provider.
Generally, credit ratings directly affect loan interest rates. However, non-TU loans do not review the applicant’s credit rating and history; they rely on proof of income and other documents to determine the loan amount and interest rate.
Before applying for non-TU or personal loans, check if the loan institution charges administrative fees, early repayment fees, etc. Additionally, late payments will incur penalties. Finally, remember the government’s advice: “To borrow or not to borrow? Borrow only if you can repay! “
To borrow or not to borrow? Borrow only if you can repay!
