Traditionally, getting a loan involves going down to your local bank and filling out a loan application. Your banker then assesses the request and makes a decision— approval or decline.
Thankfully, many legit lenders who provide online personal loans exist. Such lenders do not require you to make the application in person. Everything regarding the application and approval process happens online. Below are benefits of online borrowing:
1. Online Lenders Approve Loans Quickly
With online lenders, you get to know almost instantly how much you can borrow. The lender quickly conducts an assessment and tells you whether you are approved or not and how much your installment will be. Traditional banks may also allow online applications, but it may take days before you hear from them.
2. You Are Likely to Get Better Rates
Typically, online lenders will charge you less than you will pay anywhere else. Unlike banks and credit unions, online lenders have lower overheads and are not subject to the same regulatory costs. You can expect to pay less in interest and service fees.
3. Online Lenders Have an Easier Approval Process
You need to have a good credit score if you want to get approved by a bank or a credit union. Online lenders may be a little more “understanding” than traditional lenders; they may lend you money when your score is not where it should be. Additionally, they are willing to consider other relevant information such as utility payments to determine your creditworthiness.
4. The Loans They Offer are Unsecured
Online lenders do not typically require you to provide collateral. In the event you cannot repay your loan, you will not lose your car or your house. Well, your credit score may deteriorate; but that is something you can address when things improve.
Borrowing from an Online Lender
Borrowing from an online lender may feel a lot easier than borrowing from a bank or a credit union. But there is a sense in which it is like borrowing from anywhere else. You still have to provide personal information such as your address, income information, your expenses, and your social security number.
How do you get started? Just choose a lender and apply. The process typically takes 10–15 minutes.
Online lenders who insist on very short loan terms; insist on installment loans.
Those who charge exorbitant rates
Avoid rates and deals that look too good to be true. Choose lenders with reasonable rates and offers.
Online lenders who demand upfront payment of fees.If a legitimate online lender charges fees, they usually deduct them from the loan proceeds.
With advances in technology, consumers can enjoy various products and services with greater convenience. If you are looking for funds to finance your small business, and your bank has denied you, consider borrowing from legitimate online lenders.