Managing personal finances is never easy no matter how much you make, and everyone finds themselves in a tight spot at times. For example, what if you had to have surgery and needed to take unpaid leave from work? What if your car broke down and you found yourself stranded on the side of the road? What if your kid needed braces and you couldn’t afford them? Every day, there are people in situations like this that need money quickly. With no savings to fall back on, they turn to personal loans online. If you find yourself in a similar situation, there are some easy steps to follow in order to get a personal loan.
1. What Is An Online Personal Loan?
An online personal loan is just like any other type of loan for the most part. Unlike traditional loans where you meet with a bank representative to discuss your finances and credit history, an online personal loan works practically entirely through the internet. This makes it not only quick and easy, but accessible as well. Additionally, while other types of loans can take a while to get processed, online loans can provide emergency cash immediately which can be a life-saver in some cases. The main benefit to an online personal loan is that it can be done entirely from your home and online, making the whole process as simple as possible.
2. Bad Credit, Secured, And Unsecured Loan
There are three main types of online personal loans – bad credit, secured and unsecured. As the name suggests, the first one means you can get a payday loan with bad credit, no questions asked. It also means you can usually get cash much faster. The bad credit online loan doesn’t require a security deposit at all. However, generally speaking, it might have higher interest rates than other types of loans. Unsecured loans are loans where you don’t need to put anything down as collateral. This also implies that they are riskier for lenders, which means they may require higher interest rates than other loans. Finally, secured loans are just what the name suggests – you put up some item of value as collateral for the loan. The lender won’t sell or repossess it if you default on your loan. It’s also generally only offered by banks and traditional financial institutions that have federal government backing, although there is a way to get it without those restrictions.
3. Interested Rates And EMI
This is one of the most important factors to consider when you’re deciding between personal loans online. The higher your interest rate, the more money you will pay in interest over time. An EMI is your monthly payment made up of a portion of both principal and interest, which means it goes towards paying off the loan and not just interest. The lower your EMI, the more money you will save overall. For example: let’s say you have a 10k bad credit personal loan with an interest rate of 36%. This means that if you pay 100 dollars each month in interest alone, it’ll take 548 months – or 44 years – to pay it off! Compare that to another 10k loan with an interest rate of 24% and a fixed monthly EMI of 200 dollars. It’ll take only 264 months – or over 21 years – to eventually pay back the full amount. That’s almost twice as fast! That’s why it’s important to compare multiple loans before choosing which one you want to sign up for.
4. How Soon Can You Get Money?
If you’re wondering how long it takes to get a personal loan online, the answer is generally pretty quick. Online lenders usually won’t check your credit score or credit history at all, so they won’t even know if you’re a risk. If you meet their basic requirements (for example, that you are employed and make at least $1000 each month), then it will probably only take the lender minutes to approve your loan. At that point, you can have money deposited into your account within 24 hours. This might differ from lender to lender, though, so it’s best to read their terms and conditions page to find out more information specific to their company.
5. Fill An Online Application Form
The last step in the application process is to fill out an online application form. You can generally find this by visiting their website and looking for a banner that says something like “apply now” or “get your loan”. It will be a relatively long-form, but it shouldn’t take you more than a minute or two to complete it. You’ll usually need to provide them with your name and email, plus a phone number and address for where you want the money sent. Then it’s just a matter of filling in the required information about yourself, such as how much you make or when your loan needs to be paid back. Fill in everything honestly and remember that lying on an application is grounds for instant disqualification. In addition to this, you’ll also need to provide some details about your work and the loan itself, such as what company you work for or how long it will take until you have paid off the full amount.
6. Wait For Loan Approval
After you’ve submitted your online application, it’s time to wait for approval. If you get approved, you’ll usually get a notification via email or SMS within minutes. You can then call your lender and tell them that you want to collect the money they promised. Once that’s done, the funds should be deposited into your account within 24 hours, and then you can use the money to pay off your emergency. Usually, you’ll get a confirmation email letting you know that your application is still being processed, no matter how long that takes. It’s best to wait for this before calling the company or reaching out to them for an update. If you don’t get a confirmation email, then it might be safe to assume that your application was denied and you can move on to other lenders.
Hopefully, this beginner’s guide has been helpful for you. If you’re looking to get a personal loan online, make sure to keep these tips in mind. In the end, it’s all about being as prepared as possible for the worst. Remember that a personal loan is a quick, easy way to get out of a tight spot and start rebuilding your credit score, so you can feel better about your future!