In the days before the Internet, applying for a loan was a long, involved and not to mention an expensive process. It was difficult to compare loan rates, hard to find information about your proposed lender and the application process could run to many pages, with one mistake meaning you had to restart the whole thing!
Nowadays, you can easily compare rates from hundreds of organisations, use a personal loan calculator to see how much the monthly payments are going to be and if you are in need of quick finance, get a decision within minutes! You can even apply 24/7 as websites are never closed.
Why you may need a personal loan?
There are various reasons to apply for a personal loan. Some of them are listed below
- To cover wedding expenses
- To pay a large medical bill
- To cover a costly repair work for your home
- To start a business, which is otherwise not covered in business loans.
- To pay off your costly credit card debt
How can I apply for a loan?
In general there are 3 options for how you can apply for a loan. You can apply in a person, via online banking (this may be very useful as much of the information might be pre-populated) or through the lenders website. I listed personal loan options some time back, you can visit the post and apply for a loan.
I get feedback from my readers on the ease of the loan process for personal loans. US consumers can get approved up to $35,000 instantly online, even with bad credit.
Majority of people currently apply online for loans, due to the ease of use and speed of the application. Applying online normally takes no longer than 30 minutes and often you can get a provisional approval right then and a final approval within a few business days.
What to consider when applying for a loan
Once you have decided on how much your loan is going to be for, there are a couple of other factors to keep in mind when comparing different online loans and then applying. These factors could include:
- Interest rate: Whether you are going to choose a fixed or variable interest rate and what the rate is going to be for either of those options
- Comparison rate: This is going to be the lifetime cost of the loan, including various fees and charges
- Loan length: The duration that you will have to repay the loan. As a general rule, the shorter the loan, the higher the repayments
- Repayment intervals: How often you are going to schedule your repayments (weekly, fortnightly or monthly)
- Redraw facility: This gives you the option to pay more than your regular repayments, should you come into some extra funds. This will help you repay your loan more quickly and pay less interest in total
What information do you need to provide when applying?
During the application process, make sure you have the following information with you, as it is likely you will need it to complete the application:
- Your decisions on the different loan variables listed above
- Contact details (including work phone number and email address)
- Driver’s license/passport or even your birth certificate (you may also need copies of these)
- Your salary and proof of this in the form of a pay slip
- Details of your current monthly expenses
- Information about other items you may own, like cars, property or other assets
- Details of other debts you may have e.g. Credit cards, other loans etc.
When completing an online application for a loan, even if it’s just a small loan for some quick cash, it is always very useful to come prepared with the necessary decisions made about the various loan details and all the documentation. Be sure to read each question carefully and answer truthfully.
If you have any issues or questions about the online loan application, pick up the phone and ask the lending organisation as any mistakes may result in an unnecessary rejection!
Emmanuel M'M says
I would like to point out that all those reasons to take a personal loan generally do not seem like financial emergencies. With proper planning, one is able to save and leverage off a better financial vehicle to get money.
I think personal loans are a result of consumerism and instant gratification that we have become accustomed to and a slippery slope for most except the most adept financially
You are talking about an Utopian world. With everybody planning and then saving an emergency fund to pay off for a medical bill or doing a home repair. And everyone saving money for a wedding and paying off credit card in full every month.
But in reality, not more than 10% do it that way. So what we end up with is a high credit card bill every month. So, to me, if you have a good credit a personal loan would save you from high interest credit cards or taking out pay day cash.
We took out a personal loan at one point, and for us, it was very easy and there wasn’t any hidden fees that we didn’t know about. Overall, it was a loan that we paid off under the terms we agreed to.
Glad to know the Michelle. Personal loans are not that bad if you have to pay less than credit card insurance. Instead of charging a high amount on credit card, and if we can’t ay off within due date, then taking out a personal loan is better option.
Simon @ strengthenyourshot says
I think loans are a consequence of consumerism and immediate satisfaction that we have become acquainted to and a slick mountain for most except the most skilled financially
I think you are right but what we have is what we have. The same way we have collateral in mortgage loans. As I said in response to other comments, personal loans are not as bad as paying money with a credit card and then paying it over time. Certainly if you have good credit you’ll get better terms for a personal loan.
danny brown says
My names is Mr danny brown,I am from England,I am self employed in my country,I m very happy today thanks to Mr james,I have been in search of loan for some time now,I have come in contact with scam,whom brain me off my money,is so bad for a man like you,cheat you of your money,I got tied,and I stop asking for help,till a friend of my whom is in south Africa,she gave me a email address of a man,who privately give out loan to poor people and those looking for loan,I contacted him and he give me some papers to fill and in few hours I got a message from the bank,that is how I got my loan.