A Complete Guide to the Different Online Loan Options Available

Are you looking for great loan options? Online loans allow you to get an instant loan when you need money.

When you find yourself in an emergency, and you need instant cash, online loans come in handy. Most loans are approved in a few hours and money sent in your account.

In 2019 Small business lending approval rates reached a high of 27.5% at big banks while lending approval from small banks to small business reached a high of 49.8%. This shows confidence in lending to small entities which are also major beneficiaries of online loan options.

Here is a complete guide to the different online loan options available.

Payday Loans

A payday loan is a short term loan which works well for people who have cash flow problems. Payday loans attract a lot of controversy and are now heavily regulated by FCA.  However, as long as you understand the terms of the arrangement, you can sign up.

A payday loan comes in handy when you have an emergency. What you need to keep in mind is that you have to pay the loan the next payday. There is a penalty applied if you miss the payment deadline.

The loan helps you to pay your bills and cater to basic needs before your next paycheck. You need to pay the money back on time to ensure that you don’t get high-interest rates.

Peer-To-Peer Loans

Do you have a problem securing emergency finances at the bank? This kind of arrangement is suitable for people with poor credit rating and need money urgently.

This is a new way of borrowing money. They allow people to borrow money from other people instead of banks.  Peer to peer arrangements takes place online since its easier to match borrowers to lenders.

When you need quick cash, and you don’t want to spend your time applying for loans in the bank, a peer-to-peer loan is an easy fix. You get the money in a few hours, and you are good to go.

Also, this can work like a business where you lend money to people in need of cash. When the loan is paid back, you get extra money in your account as the interest.

Small Business Loans

Online loans are not only available to individuals, but also businesses can take advantage. Most businesses operate on loans. If you want to expand your business, taking a small business loan is always a great idea. You get the money you need for your business, and you can pay it in the agreed period.

Applying for an online loan is faster than applying through the bank. You are not guaranteed that you will get the money, but since the process is faster, you get feedback in a short time.

Also applying for an online small business loan saves you the time you would have spent going to the bank. This is what attracts people to apply for online small business loans.

Debt Consolidation Loans

Are you in debt and you are not sure how you will pay it back? The debt consolidation loan is an online loan which helps you cover debts.

Being in debt is something that many people experience. It easy to be overwhelmed by debts, especially when you are in a prolonged financial difficulty. Many small tangled debts can make your life a living hell.

Getting a debt consolidation loan allows you to pay all the small debts. This turns all your debts into one big loan that you can manage and come up with a working plan to pay. However, this type of loan is not a magical solution to your debt problem.

Cash Advance Loans

Cash advance loans have been around for ages. If you have a credit card, you can apply for the cash advance loan.

The credit card companies have used this aspect of the cash advance. The companies advance cash to you and allow you to spend money in your credit card any way you like.

However, you need to ensure that you stick to a repayment plan and pay your loan on time. The loan is applied online by contacting your credit card company using their website.

Guarantor Loans

Guarantor loans have risen in popularity since you can access them even when you don’t have a excellent credit history. Back yourself with a guarantor loan if you need money, but you are not sure whether you will get it.

Look for a person you can trust and who has a excellent credit history. This person can be a friend or a family member. Ask them if they can be your guarantors. In case you fail to pay for the loan, your guarantor is the one who pays.

Ensure that your guarantor knows the risk of signing the documents. Allow them to take their time and go through the terms and conditions of the loan.

Online Installment Loans

What are online installment loans? The online installment loans are small loans that are paid back in fixed installments.

Also, each of the payment has a deadline that you have to meet. The only downside to the online installment loan is that you can’t pay the debt earlier. You have to stick to the fixed installments payment schedule or you will incur fines and penalties.

Online installment loans are good at forging debt payback discipline. Hence, online installment loans are seen by many people as a good alternative to payday loans. Online loans are less risky and target the same market as payday loans.

Online Loan Options – Summing it Up

There are several online loan options that you can apply. This will depend on the flexibility of paying the loan. Online loans are suitable for emergencies. They include, online installment loans, guarantor loans, cash advance loans peer to peer, and small business loans.

Most people opt for online installment loans. This is because the loans are approved in less time and you don’t have to spend time at the bank. Also, you can get a loan without having any asset or property to serve you as collateral.

Visit our blog and find more about the different loan options available.

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