How to Set Up an In-House "No Credit Check Financing Plan" With Little Or No Cost

This is a great system that is perfect for small businesses. I have personally seen this program generate 25%-%40 increase in sales just by telling people you offer “No Credit Check Financing”. This article will show you step by step the way to set it up and many ideas dealing with advertising the plan.


When implementing the concept discussed in this article, Customized Concepts does not inherit the responsibility of the loans being paid back, of legal issues, or of anything that results from the use of this information.

The legal disclaimer is a must. We do offer a “90 Day Financing Plan” that is guaranteed. We take care of the details and the risk. There is no risk to the merchant. This article is based on the idea. You can put many things in place to insure the loans are paid back. This will be your responsibility. We will discuss them and let you know the pros and cons.

You will need a good file management system. If you are running a business this is not really a problem. I recommend that all the paper work is scanned into your system. This allows for quick retrieval if there are any problems with the contract the customer signs.

Below is an example that does not charge the customer finance charges.There is an example on our website that has finance charges. This would qualify your program as “Same as Cash Financing”. You are allowed to charge finance charges and application fees. This would create another income stream for your company but, you can not advertise “Same as Cash Financing”.

The choice is up to you.


Yoshi walks in to your store and wants to buy your product or service but does not have the money and has bad credit, no credit, or just does not want to take out a loan. The item costs $1000. Yoshi says that is too much right now. You explain that you can offer him a “No Credit Check Financing Option”. He says “Great”. You and Yoshi agree on what payment schedule will fit in his budget. He agrees that $200, every two weeks, would fit his budget.

Yoshi will then write you out five checks post dated checks for the amount of $200 each. Five $200 checks equal the $1000 sale price. I know there is someone saying is that legal. Yes. The law with post dating checks is very vague.

The two major things that come in to play are:

1. If the customer writes a post dated check that they know will not be good on the post dated date. This is a form of fraud. Customer is in the wrong.

2. You cash the check before the post dated date. When you and the customer agree on the payment schedule you are agreeing to cash the check on the dates stated on the contract. You are in the wrong. They can sue you for the penalties incurred and numerous other things depending on your state.

It is a good idea to keep the post dated checks within 90 days of the sale date. This is safer for you and the customer.

The check will need to be kept safe (in a safe). This will make sure that they do not fall in to the wrong hands.

Next you will need to get the filing system in order. You will need a way to let you know when the checks need to be cashed. You can do this one of two ways.

The first would be a basic folder arrangement. Create one folder for every week. Check the folders at the beginning of the week son you know what checks need to be cashed.

The second and probably preferred would be a basic program with Excel or some other spreadsheet program. This would require that you put the information in to your system, but would save the file set-up time. You will set up the spreadsheet to organize the payments by date. Check the spreadsheet every day to see what checks need to be cashed.

Here are a couple things to protect you from fraud and default on repayment.

The options below are up to your discretion. You can use one of them or all of them. The more you implement the more protection you will have that the customer will not default on the loan.

This first three are, in my opinion, a must.

1 Get a copy of the customers I.D.

2 Get a copy of their most recent pay check stub. You can take this one step further and verify employment. You can give the employer a call or you can send a fax to the Human Resources Department. The easiest way is to call. They can not give you much information over the phone but, they can tell you if the customer works there and if there is anything that might affect his future employment.

3 Call the bank to verify the account is in good standing.

4 Verify the Checks. If you have a merchant account that can process checks this can be simple. If you do not have check verification you can call your provider and check pricing to get it set up. If you do not have check verification and you do not want to pay for the service there are some other options. They are not as reliable but will work. Physically go to the bank where the check was issued and cash it. If there are not funds they will tell you or they will cash it and charge the customer an overdraft fee. DO NOT DO THIS WITH THE POST DATED CHECKS. This should only be done with checks that are not post dated. You and the customer came to an agreement that you would not cash the checks until the date on the checks.

5 Verify the customers check writing history. This can be done a couple different ways. Check out National Check (NCN). You can also do a search on Google or for “How to verify a customer check writing history”. These systems can vary in cost and quality. We use NCN. This option will let you know if they have bounced checks that are outstanding, a history of writing bad check, or any check fraud in the past.

These are the basics and if want to tweak it to fit your company better, great.

We have a customizable contract on our website available for download. The form is a PDF. If you do not have a PDF editor you can go to and convert the file to a.DOC file. This contract is free of charge and we will not ask you to give us any information. This is a great tool that will save you some time. There is no need to design your own. This is the exact form we use.

We also offer “No Credit Check Financing” that takes away the risk and is very user friendly. We implement the procedures above and guarantee the payment to the merchant. If the customer defaults we will honor the payment and we will take action to recover the monies owed. The fees involved are normally less than what it would cost you if you to set up check verification and verification of check writing history. It is guaranteed to save you time.


Advertise the “No Credit Check Financing” everywhere. Here are a few suggestions.

Get a sign/banner that states you have the program. We have a local company that will paint the lettering on. You can get your local sign maker to help you, also. Window appliques, appliques for your car, magnets for your car, the list goes on and on.

Change the on-hold audio so it mentions “No Credit Check Financing” and also voicemail box recordings. Be sure to mention the plan when you answer the phone.

Include the program on anything that your business uses for advertising.

* Yellowbook Ads

* Business Cards

* Brochures

* Website

* T-Shirts

* Vehicles

* You need to get it visible to as many people as possible.

Do a local radio commercial that states you now offer “No Credit Check Financing” This is spectacular if you can afford the media.

I hope everyone reading this did not find it a waste of time. If you can not use the information in this article please pass it on to someone who can. If you would like you can download an exact copy of this article and contract here. We will not ask for any information. I will be writing more articles in the near future. The article will be on ways that small businesses can increase their sales with various techniques. Please subscribe to my newsletter if you would like to be emailed when they are posted.

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