Running short on money happens to the best of us. And when it does, many of us turn to a personal loan or line of credit for help. These financial products might be the right option for you too should disaster strike when your savings are low.
But don’t worry if time is as tight as your purse strings. These days, online loans make it faster and easier than ever to get the cash you need.
What Are Online Loans?
In many ways, an online loan or online line of credit is identical to the ones you would receive in-person at a brick-and-mortar financial institution. You’ll either receive a lump sum of money or a personal line of credit limit to use as you like.
Both these products come with interest and finance charges, as well as a pre-determined repayment schedule you must follow to avoid late fees.
How they differ is when, how, and where you get them.
Moving the Application Process to the Screen
Historically, you would need to meet with a financial advisor to look over your finances and review your application. This usually happens during a meeting at the financial institution, during usual business hours.
With an online loan or line of credit, you don’t have to go anywhere to submit your application. Financial institutions rely on AI technology to receive, process, and file online applications.
Technology Speeds up Your Experience
If you borrow money online, many of the steps become automated with an online system filing your answers. While there may still be a case manager who reviews your answers, this automation cuts down on the time a financial advisor takes to manually complete each step.
The result? You may end up getting the online loan or line of credit faster than if you applied in-person. A financial institution like CreditFresh has an online request form that only takes a few minutes to complete. Once you verify your information and sign a loan agreement, you may receive a CreditFresh Line of Credit by CBW Bank as soon as the next business day.
In contrast, an in-person loan or line of credit may take longer. Beyond the time commitment of an interview, several days may pass before you hear whether you qualify, and it could be weeks before you receive the cash you need.
Data-Driven Applications Open Doors
In-person borrowing options have a specific hierarchy. Those with high credit scores tend to be approved, while those with bad score lose out.
Online loans may give more leeway for people with subprime credit. Online applications mine for other data beyond a simple score to determine if you are creditworthy. While you may still have your credit checked, other factors may impact your success. This means a bad score won’t necessarily take you out of the running.
Brick-and-mortar financial institutions may never close their doors forever, but online options are changing the way people borrow. The next time you need help in an unexpected emergency, consider what tech-based loans can do.