Off the books loans are any loans which do not show up on your credit report. Generally, most types of loans do show up on your credit score. This way, potential lenders can see how much debt you have, how reliable you are in making payments on that debt, and how much of a credit risk you make. Your credit card debts, personal loans, mortgage, car loans, and other personal loans are all listed on your credit report and reflected in your credit score. Generally, if you have a lot of debt, your credit score is a little lower.

However, there are some types of loans which are not listed on your credit report. If you borrow from friends and family, for example, this is not listed on your credit report. Certain types of hard money loans from private lenders are not listed on your credit report. In some cases, these types of loans may have higher interest rates or other disadvantages, but there are some advantages to getting off the books loans, too. These loans will not affect your credit score, so if you need to apply for multiple loans (to start a business, for example), off the books loans can help you get all the financing you need. If you are trying to repair your credit and need to borrow money, these loans will not pull down your credit more.