What Does “Any Credit Accepted” Really Mean?

What Does “Any Credit Accepted” Really Mean?

We’ve all seen it before, specialty and online lenders promising that your credit score won’t hold you back from getting the loan you need. “Any credit accepted” has become the new motto for these less traditional lenders. Banks and other institutional lenders typically still rely heavily on credit scores to help them decide a borrower’s creditworthiness.

So what does “any credit accepted” really mean? Generally speaking it means that your lender doesn’t care about your credit score, or that it will have little to no effect on whether or not you’re accepted. The types of lenders that advertise “any credit accepted” are different from banks and therefore follow different rules and regulations and have different criteria for deciding who they can and cannot approve.

Credit Scores in Canada

In Canada a credit score can range from 300 to 900. The highest scores are given to those who always make their loan and credit cards payments on time, have small amounts of credit card debt and have no credit accounts in collections or previous bankruptcy filings. The most common ways to lower your credit score are by missing payments, maxing out credit cards and being unable to pay them off, having an account go into collections and filing for bankruptcy.

“Any credit accepted” lenders typically do not even look at credit scores and instead use a variety of other criteria to judge whether you’re a good candidate for a loan or whether you’re too high of a risk.

You’re a Person, Not a Number

Lenders who don’t even look at or consider your credit score are typically more willing to listen to you and your story. You’re not just a number but rather a person with a financial history who needs a loan for a specific reason. New lending start-ups, speciality lenders and online loan companies offer a more personalized loan experience, this means that you’ll be accepted or rejected based on more than just a three digit number. Loan approval rates are usually higher which means you’re more likely to get the money you need when you need it.

Do You Have a Low Credit Score?

Having a low credit score doesn’t necessarily mean that you’re financially irresponsible and can’t handle a loan. A credit score isn’t always the best way to judge someone’s creditworthiness, especially in extenuating circumstances. That’s why this new wave of lenders who accept any and all borrowers no matter what their credit scores are, are an asset to the financial world.

A low credit score can sometimes feel like it’s holding you back, like you’ll be unable to accomplish anything financially until you’re able to build it back up. It’s a frustrating situation to be in and can often be aggravated by the constant rejection by more traditional lenders. “Any credit accepted” lenders understand this issue and are stepping up to help out all Canadians who need loans but can’t get approved because they’re credit score are being used against them.

Debt-to-Income Ratio

Your debt-to-income ratio is one of the criteria that these lenders always look at. You can calculate your debt-to-income ratio by figuring out how much of your monthly income goes towards paying off your debts. So for example, if you currently have a lot of credit card debt then a large portion of your income is probably going towards paying it off.

The reason why this is an important factor for “any credit accepted” lenders is because it’s a great indicator of how financial stable a person is. If your debt-to-income ratio is too high it probably means you’re stretching yourself too thin, have too much debt already and probably won’t be able to handle even more debt. But on the other hand your debt-to-income ratio could be low, thus making you a great candidate for a loan, while other lenders continue to reject you because they’re basing their decisions solely on your credit score.

Length of Employment

Lenders who accept any credit also take into consideration the amount of time you’ve been at your current job, this is another way these lenders treat their potential borrower as more than simply a three digit number. Having a long-term stable job, shows a lender that you’ll be able to make payments on a new loan even if your credit score isn’t as high as you’d like it to be.

Work With a Lender Who Wants to Help

If you’re currently looking to apply for a loan but are having trouble finding an institutional lender who is willing to work with you because they consider your credit score to be too low then you need to look into lenders who aren’t interested in your credit score. Working alongside an “accept any credit” lender will not only allow you to get the money you need but will give you the peace of mind that you’ll be treated as more than a number.

Want to learn more?

You can learn how your credit score is calculated by here or, check out our Improve your Credit blog series.

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