Some years ago, the possibility of applying for a loan and having access to it was really complicated, as conventional banks usually have very strict requirements that prevent people who need some capital to get out of a hurry from having access to a loan or credit.
Fortunately, online loans have made it much easier for people to access credit, as the requirements they apply for are not as strict or high. This is, without a doubt, one of the main advantages that we can find in this type of financial platform.
However, it is important to take into account all the information that surrounds online loans; so that it is easier to compare the different options that are available and thus be able to choose the one that best suits our needs.
It is true that most financial platforms that offer this type of service usually have very similar conditions and operation, from the application procedure, requirements, interest rate, maximum time to pay, etc., but it is really important to take into account each of these aspects to ensure that we are about to make a good decision when applying for credit online.
That’s why, on this occasion, we have prepared a guide that can help you determine which service best suits your needs or which you think gives you a fairer service. At the end of this article, you will have much more information on the subject and you will be more informed about all the aspects that you must take into account.
- 1 What are online loans?
- 2 How online loans work
- 3 How much money can you borrow?
- 4 How to apply for a loan online or credit online
- 5 What are the requirements to receive a loan online?
- 6 Can I trust the online credits?
What are online loans?
Online loans or credits are provided as financial instruments by a public or private entity, in which a certain amount of money is given to the client in order to pay it back in a certain time and paying certain interests.
In short, it is a contract with a company in which the company gives a certain amount of money in exchange for the client paying that amount plus commissions or interest over time.
This is a fairly convenient option for both parties, since the user receives the money he needs to get out of a predicament or to invest (depending on his needs), and the institution receives his money plus an additional profit created by commissions or interest.
It is important to be clear about what type of contract you are making, so you should always read the contract you are about to make with a financial institution very carefully, having absolutely clear all the details involved.
How online loans work
Even today, it is still normal for some people to find it strange or strange to make purchases or request services from the comfort of their home, but this is not really a reason to be suspicious, since nowadays millions of people all over the world make purchases or contract services from the comfort of their home, this being one of the great advantages of digital services.
In this case, companies that provide loan services online request all the information they need through forms during the registration and loan application process, so you don’t have to leave your home so that they can review your credit history and personal information to determine if you are a good candidate for the loan.
As we mentioned before, the operation of these types of platforms is very similar, so in most of them you will find a simulator and an “Apply” button. In this simulator you will be able to establish the amount of money you need and the period of time in which you want to pay it, which will make it show you the amount you will receive and the total amount you will have to pay with interest in the period of time you have chosen.
An important aspect you must take into account is that the faster you pay back the loan, the less interest you will pay, so it is recommended that you pay it back as soon as possible without letting too much time pass.
Once you have chosen the amount and the period of time, you simply have to select the option to “apply”. If you are not a registered user and this is the first time you apply for a loan on the platform, you will have to go through a registration process in which you will have to provide personal and banking information.
Usually we ask for your full name, date of birth, place of residence, proof of address and the bank account to which you want the money deposited. Some platforms may request proof of income, but the vast majority do not.
If your application is accepted (or if you are offered a counter-offer for less money and you accept it), the money will be deposited into your account within a short time, possibly within 10-15 minutes.
Keep in mind that it is really important that you make your loan payments on time, otherwise they will begin to generate interest arrears, so the debt will increase to an amount that will make borrowing a big mistake.
How much money can you borrow?
The amount of money you can apply for can vary greatly depending on the service in which you decide to apply for the loan. Keep in mind that these services are usually for people who need to solve an emergency or a problem in the short or medium term, so they are not usually such large amounts of money.
Usually the amount of money you lend is between £1,000 and £30,000, where you will probably need to show proof of income to borrow the larger amounts. Loans over £1000 are already considered as long term personal loans, so platforms that ask for less requirements usually lend less.
Long-term personal loans tend to have a repayment period of up to 60 months, while fast personal loans tend to be paid back in a maximum period of 30 to 60 days, as they are smaller amounts that are intended to help people out of small financial difficulties.
As mentioned above, all of these factors can vary from service to service, from the amounts granted to the time it takes to pay them back, as well as the interest the account will generate.
Can I apply for loans for larger amounts?
There are some loan companies that can provide loans of up to 60,000 euros to be paid back in a term that can range from 1 year to 9 years. But these already have much larger financial requirements, so if this is your situation, you may need to compare all available financing options, including conventional banks.
Also, one of the advantages of these larger loans is that they are paid in monthly installments and the interest is usually lower than what you would end up paying with an immediate loan, plus there is the possibility that you will have to pay earlier so that you can pay less interest to get out of debt by paying less.
As you can see, it really doesn’t matter much what your financial needs are, online loans are an excellent option for all types of users, you just have to compare and analyze the situation very well, because if you plan to invest the money you have to have a plan B to pay in case the idea doesn’t work out completely. Having a debt to pay with a business that was not successful, can become a big and serious problem.
How to apply for a loan online or credit online
As we have commented on several occasions throughout this article, one of the great advantages of online credits is that the money is deposited in a few minutes or a maximum of 24 hours since it was approved, so they are excellent services for users to get out of emergencies.
The steps that have to be done to apply for the loan are very short and simple, but here we will explain them to you in a brief and clear way so that there is no doubt about it:
1.- Access the official website of the service
Once you have finished comparing the different services you are interested in and have chosen one, go to their website and use the simulator on their homepage. Remember to check that everything is OK, from the amount, the time of payment and the interest you will end up paying, as well as the ways you can make the payments.
2.- Complete the form to finish your application
The next step is to complete the registration and application form on the platform where you are applying for the loan.
As mentioned, you will have to add personal and banking information as requested. Before completing or sending the information, check that all the information you have provided is correct and updated, as this is necessary for them to be able to make a good evaluation of the registration.
The review process is very fast and almost automatic, so you will not have to wait long for your application to be rejected or accepted, the latter being the most common scenario.
Keep in mind that adding false information may be considered an attempt at fraud, so there may be some pretty serious consequences for doing so.
3.- Wait until the review process is over
Once the request is completed and sent, it will be sent and evaluated automatically, so you will receive an almost immediate response, having to wait a few minutes to get an answer.
In case your application is accepted and if it is a business day, the money will be deposited in a short time. You may have to wait only 15 minutes to receive the money in your account.
4.- Choose the payment method that best suits your needs
Now that you have the money and can use it for whatever you want, the next thing is to pay off the loan. Payment methods may vary from one platform to another. You can accept payments in convivial stores, debit card payments from your platform, by bank transfer, etc.
What are the requirements to receive a loan online?
The requirements to be met in order to access a loan may vary a little, although they are generally the same on most platforms, and may vary when the interest is for larger amounts of money.
Among the general requirements that we can find in most platforms we can highlight the following:
- To be a legal resident of the country of which the platform is from, and to have a valid official identification that verifies them.
- Be of legal age.
- To be the owner of an email account and a mobile phone, since this is how the communication between you and the platform will be carried out.
- Have a bank or cash account so that you can receive the money from the loan in it, and also be able to pay the loan using that bank account.
- Depending on the platform, you can also request a monthly income receipt. This can be done with a pension receipt, payroll receipt, insurance receipt or any other proof that shows you are self-employed and the amount you receive.
These are the main requirements that we can find in the vast majority of platforms, although there are some where the details may vary, such as being 21 years old or older and under 65, having no debt on your credit history, etc.
Anyway, no matter what your situation is, you will most likely be able to find one or several platforms that will accept you, although perhaps not with the maximum amount you want. That’s why we recommend that you be patient and choose the option that best suits your specific needs.
Can I trust the online credits?
Some years ago, the only way to obtain a loan or credit was through a traditional bank and the process was more tedious and complicated due to the requirements they requested.
However, online financiers and online lending companies have made this process much easier, being professional and reliable companies that have earned their place through good service in recent years.
The ease with which they can get to give the loans makes some people come to distrust, but the truth is that today there are many reliable and professional options to which we can go to get money.
As in everything, especially through the Internet, if there are pages and people who seek to scam people, so it is very important that you look at the following points to avoid any misleading or scam page:
- Never trust any site that asks for money in advance. No reputable and legal loan company asks for a payment “to release the loan”.
- If the interest is not specified from the beginning, it is best to stay away from that platform.
- Pay close attention to the fine print and review the fees that will be charged on your loan.
- Before making a decision, look for opinions through Google, probably in several forums or sites they already gave their opinion about a platform.
If you feel that there is something suspicious or something that makes you doubt about the platform you are thinking of using, it is best to use another option.
Taking into account the previous points, especially the first one (that they ask for money in advance), you will be able to stay away from pages that only seek to swindle you and thus you will be able to ask for the loan in a safe and quality page.