Getting a loan from the bank or other institutions may take some time to get approved. If you need quick cash, you may want to consider getting an online loan application. You no longer have to wait for a week or a month to get approval for the necessary loan.
It can feel like an online loan is such a great way to have money fast. However, along with the many advantages, it also has its disadvantages. So what are the pros and cons of an online loan?
First, let’s look at the benefits you can enjoy when getting this type of loan.
1. Easy Approval – Compared to other types of loans, getting approval is much easier. Online lenders often have low criteria that you can easily meet to get approval. This may include having a stable source of income, a bank account and being of legal age.
Even if you have bad credit, there are online lenders who offer online loan services tailored to your needs. If you apply for a bank loan with a negative credit rating, your application will probably end up being rejected.
2. Less hassle – The tedious part when applying for a loan from banks and other institutions is the paperwork you need to submit and fax them. You need to submit the correct credentials to get a loan approval. However, when applying for an online loan, you do not have to go through the same tedious tasks. You only need to fill in an online form and you are done.
You no longer have to wait in line or personally travel to the bank or other institutions to apply for the loan. This saves you both time and energy as you can make it comfortable in your own home with your computer.
While there are many benefits that can make an online loan application very attractive, it also has its drawbacks.
1. High Fees and Interest Rates – Professionals will advise you not to get this loan unless the need is urgent. Online loans have higher interest rates and fees compared to normal loans.
Except for the high interest rates and fees that you have to pay when applying online. You will also have to pay a fee if you are late with your payment. Most late repayment fees charged by online lenders are quite large that they can reach double or triple the amount you borrowed.
2. Short repayment course – Normal loans from banks and other institutions can give you a repayment plan that divides your debt payment over a long period of time. Repayment can be done within a year or two when you get a normal loan. However, an online loan requires you to settle your debt within a shorter period of time. it can be within two weeks or a few months.
3. Unclear Terms and Conditions – In some loan services, there may be certain terms and conditions that place you in a high risk situation. This is often intentionally hidden or obscured as they do not want you to know anything about it.
While helpful, there are things you need to consider before getting an online loan application. You must always weigh the pros and cons before deciding on anything.