You can get fast personal loan approval
It seems that financial emergencies are the norm these days. We have been bouncing from one financial crisis to another for the past twelve years. When you have bad credit and need a quick loan, a two-day wait is usually acceptable, but a loan denial is not.
Fortunately, the Internet has given us all the ability to deposit money into our bank accounts within a few hours of applying. You only have to comply with the conditions and requirements proposed by the credit institutions. It’s also a truism that the cost of instant approval is higher than if you can wait a day or two to get approved.
The reason why an online lender can give you instant money is that they are not running any credit checks on you. This means they have to use other means to determine the risk of you defaulting on the loan and your ability to make monthly payments.
What does instant approval mean?
Instant approval does not mean there is no approval process. Believing that someone who doesn’t know you personally will just give you money without doing any kind of verification is crazy. However, the instant approval seems to indicate that sanity is overrated.
The approval process used by online lenders is very simplified as there is no credit check. The credit check takes several hours, and that’s one of the things that slows down traditional lenders in the approval process.
Online loan applications use computer software to review loan approval criteria. The software can quickly calculate your debt-to-income ratio and determine if the loan is affordable for you. The software can then send the email and begin transferring the money to your account.
Instant loans are not perfect
With all the good news surrounding instant loan approval, there is some bad news. Mainly, having bad credit makes the loan more expensive over time.
Expect to pay an additional 1 percent interest on your loan when you go through an online lender with instant approval. They will also have lower maximum loan amounts, some of which may be as low as $10,000.
What about payday loans?
It is impossible to turn on the radio or television today without seeing an ad for personal loans. Payday loans have become a common loan option for many people. It is almost impossible to get turned down for a payday loan as long as you have enough income.
The premise behind payday loans is that you are borrowing money before your next paycheck. The original payday loans would take the full refund out of your bank account on the day of your next paycheck. This made the loans risk free for the lender.
Originally, payday loans were limited to amounts between $100 and $1,500. They would charge 30 percent interest. Today, payday lenders will lend much larger sums at higher interest rates. If you can’t repay the loan quickly, payday loans are very poor financial options.
Payday loans can be helpful if you can pay them off within a month and use the money to pay off other debt. This will increase your credit rating and allow you to get better personal loans to consolidate your existing debt.
Always do your due diligence when looking for an instant loan. There are scams on the internet and they want to get your personal information. Call their customer service number and make sure it’s a responsive business. Make sure they don’t just list a PO Box for your corporate address. Protect yourself so that when you’re in a financial crisis you don’t get into an identity theft crisis too.