Life doesn’t always turn out the way we expect. A medical emergency, a home repair or even a dream vacation could knock on your door when you least expect it. That’s where personal loans role — and technology has made applying for a personal loan online easier than ever.
The New Way to Borrow
No more waiting in queues at the bank and paperwork. These days, applying for a personal loan is as easy as opening an app or visiting a website. Whether you’re looking for $1,000 to repair your car or $50,000 to remodel your kitchen, online lenders are sprouting up with promises of rapid approvals, scant documentation and cash that could be in your account within 24 hours.
SoFi, Upstart and LendingClub companies are doing this digital movement. So they’re using cutting-edge algorithms to determine who’s creditworthy and who isn’t — and sometimes looking at things like education, job history and other nontraditional data points. The result? The quickest, most inclusive loan process yet.
For more people personal loans online are becoming the norm
The main reason people choose online loans is speed. Traditional banks may take days — even weeks — to approve a loan. Online lenders? Some get it done in minutes.
There’s also transparency. A few clicks let you compare interest rates, repayment terms and fees all from the comfort of your couch. It’s money shopping — cooler, easier and more secure.
Additionally, online loans are typically unsecured, so you won’t need collateral. You do not need to put your car or home on the line in order to pay an overdue bill.
Real Stories, Real Benefits
Consider Alicia, a freelance graphic designer in Austin. She turned to an online loan provider when her laptop crashed days before work for a big client. Within hours, she had the money to purchase a new system, meet her deadline and salvage the client relationship.
And then there’s James, a single dad who took out the eponymous $7,000 personal loan to consolidate high-interest credit card debt. The monthly payments were lower, and for the first time the prospect of escaping the debt spiral felt within his reach when he switched to a lower-rate online loan.
What to Watch Out For
Even if you borrow personal loans online, you need to have the knowledge. Be wary of hidden fees, including origination fees or prepayment penalties. Read the fine print. A low monthly payment could mean a longer term and more interest paid overall.
Also, be wary of scams. Only borrow from licensed lenders and those with solid reputations online. If it sounds too good to be true, it is.
Final Thoughts: Borrow the Smart Way
Life happens and online personal loans give you speed, flexibility, and freedom when you need it most. They’re not only for emergencies, though.” And they are using them to invest in education, improve their homes or simply finally take that long-await trip.
If you’re looking to take out a personal loan, going online may well be the best thing you do this year. Just remember to borrow responsibly, understand your numbers, and work with a lender who will put your needs first.
