Loans for No Credit

Cara Bradley

Written by

Cara Bradley

4 min read

Updated: 08/03/2024

What exactly is a ‘thin’ credit file, how could it affect your chance of being approved for a loan, and is there anything you can do to increase your score?
Our guide provides answers to everything you need to know about having no credit history.

What does it mean when somebody has no credit history?

Having no credit history is sometimes referred to as having a thin credit file and is not to be confused with having bad credit.
If you have a thin credit file it means there is no credit history available for lenders to view when considering your loan application. This is common in people who are just starting out on their independent financial journey and have never paid bills or borrowed money before.

Can I get a loan with no credit history?

While having a thin credit file isn’t necessarily a bad thing, you might struggle to find a loan. This is because the lender has no evidence of how you manage credit and may see your application as a risk.

Getting approved for a loan with no credit history is not impossible as some lenders specialise in loans for those with thin credit files. That being said, if your loan application is accepted you may find that your offer is at a higher rate of interest. There’s also a chance that you may not be able to borrow as much money as you’d like. However, it’s important to remember that you are not obliged to accept any loan offer if you feel it is not right for you and your circumstances./p>

Can I search for a loan with Viva Money even if I have no credit history?

Viva Money is a credit broker, not a lender. We work with a panel of trusted lenders who offer loans between £100 and £10,000. Depending on how much money you apply to borrow, repayment terms could range from 3 to 60 months.

Viva Money welcomes people with all types of credit score to search for a loan.
mber of lenders on the Viva Money panel are willing to consider applications from those who have no credit history.

Will building my credit score improve my chance of being approved for a loan?

When it comes to applying for a loan, a good credit score could help to increase your chance of acceptance, as well as unlocking better interest rates and broadening your borrowing options.

How can I improve my credit score?

Try not to worry too much about having a thin credit file; everybody has to start somewhere.

There are several things you can do to work towards a healthier credit position.

  • Open a bank account if you haven’t already.
  • Pay your bills on time.
  • If you have a credit card, stay well within your credit limit, and make at least the minimum repayment amount each month. Try to make more than the minimum repayment amount if you can comfortably afford this.
  • Avoid using your credit card to withdraw money from cash machines. This is known as a ‘cash advance.’ Not only is this likely to result in extra charges and fees, but lenders may also see it as poor money management.
  • Check your credit report for any errors and outdated information.
  • Register to vote. Being on the electoral roll will allow potential lenders to verify you and your personal information, including your current address.

Credit building credit cards

If you’re hoping to improve your score, you may be interested to learn more about credit building credit cards. These cards usually come with a modest credit limit to help you manage your spending. Use the card to make small purchases that you can repay in full each month.
Your spending and repayment information will be fed back to the credit reference agencies and, in time, you may see an improvement in your credit score.

It’s worth noting that these cards should not be solely relied upon to increase your score. For best results, use alongside other credit building methods, such as those mentioned above.

I’ve taken out a loan that I am now struggling to repay. What should I do?

Sometimes, our financial circumstances change for reasons out of our control. This can feel scary, but if you find yourself in a position where you’re no longer able to afford your repayments, you should contact your lender.
This may be the last thing you want to do, but the sooner you reach out and ask for help, the sooner your lender can work with you to put a plan in place moving forwards.

Where can I find money and debt management advice?

Viva Money is proud to have teamed up with charity StepChange to create a Money Health Check quiz, which you can take online for free. The quiz should take less than five minutes to complete, and the answers you provide will generate advice that could help you take your first steps towards regaining control.

Free, impartial money and debt management advice can also be found on websites such as MoneyHelper, Citizens Advice, and National Debt Line.