Of course, some people may prefer to speak face-to-face with a representative of the lender when looking for a loan, and you should always do what feels the most comfortable for you. However, this does often take more time and if you need a loan urgently, an online application can really help to streamline the process. Speed, however, is just one of the benefits when applying for loans online. Read on to find out why online loans may be more advantageous than first meets the eye.
Speed
The speed in which a loan can be applied for and paid out is an obvious benefit to online lending, and it’s the one which many previous borrowers will cite as their main reason for applying on the internet. Rather than go through the hassle of filling in an application by hand and having it processed in a branch, where there will be fewer people available to process it, online loan applications tend to be serviced by more people, as the demand and competition is higher.
The information you provide online goes directly into the lender’s computer system, so no work has to be done to transfer this through to the correct channels. Lenders may also have computer programs which are able to part-process some of the application, so that ones which are incomplete, ones which definitely do not reach the lending criteria and ones which are to be processed straight away can be distributed to the correct people. All of this saves valuable time and resources, allowing lenders to dedicate more people to ensure that their service is as fast as possible.
Convenience
Where the need for a loan is unexpected, many prefer the online approach as you can apply on-the-go with your smartphone, or on a tablet. When you’ve got work or family commitments, it may not always be easy to visit a lender in your nearest town or city, so online loans can be a welcome and speedy alternative. When you also take into account the potential queue in-branch, the length of time it takes to fill in an application and the fact that it’s likely travel costs are involved, applying from the comfort of your sofa or whilst on a lunch break is often an advantageous choice.
When looking for loans online it’s likely you’ll come across a wider choice of lenders offering a larger choice of loan products compared with the high street. You can also find comparison websites and independent review sites which can help you to make the best choice for your circumstances in relatively little time.
The speed in which information can be found, shared and processed on the internet makes searching for a loan online a very convenient experience indeed; the ability to look up confusing jargon and FAQs during the process is invaluable to many applicants.
Access
Then: In the past, it’s likely that a loan application would have to be filled out by hand, and the bank manger would make the final decision on whether you could be given the loan. People tended to borrow from their own bank, and would rarely consider applying for a loan elsewhere. It would traditionally take several days to process an application; especially in the days before everything was digitised, and sending information from place to place had to be done by fax, phone call, or even by post. Back before the internet, you could only make an application or receive your funds when the bank was open, so discovering you need emergency funds late on a Friday would have left you in the lurch. Additionally, travelling to the branch itself could have meant a long walk, cycle, bus ride or trip in the car.
Now: Accessing a wide range of fully regulated lenders offering everything from £500 - £5,000 over a range of lending products can be done at the click of a button. What’s more, you can apply any time of the day or night via a desktop computer, laptop, tablet or smartphone, anywhere in the world that you have internet access. As long as you are financially able to pay back the loan, legally able to borrow, and you meet the lending criteria, you can apply and receive money, in many cases within 24 hours, at your convenience.
Then: If you needed some money quickly, fast access to personal loans was a lot less official in the past, and usually involved borrowing from a loan shark, from friends or family, or by selling something of value - none of which were favourable options for the majority. Not having access to information about the consequences and expectations of certain lending types could also be a problem – it is likely many people fell foul of loan sharks and other illegal lending practices which may have appeared to be their only option, and one that they could not fully understand.
Now: With full access to a wealth of financial information about everything from interest rates, to online loan comparison sites, to customer reviews, you get to make an informed decision about who you borrow from and which lending product is the best fit for you. Having all of this at our fingertips is a privilege we have come to take for granted, and it’s invaluable when considering something as important as taking out a personal loan. Being able to do research beforehand can ensure the best lending deal for your needs and will hopefully pair you up with a company you’d be happy to do business with in the future.
Rates
Due to the increased competition in the online loan industry, as well as the lower running costs, interest rates can be lower online than in a traditional bank branch. The fact that potential applicants are able to compare lenders quickly, easily, and for free means that they must stand out from the crowd, and this inevitably leads to a lowering of rates over time.
It’s important to note that fully regulated and serviced online loan lenders will have this clearly stated on their website (usually at the bottom of each page) and should provide a phone number and contact form or email address. It’s likely that you’ll have to speak to one of the processing team at some point, so applying online can and does also involve contact with a human being, should you have any concerns or questions. Applying for loans online therefore, is convenient without losing that reassuring contact with someone real who knows what they’re talking about, and who can pay out your money quickly without hassle.
