Personal Loans

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Personal Loans

Borrowers Who Should Avoid Personal Loans

Today, large banks are not the only possible source of borrowed funds. Any individual may apply for a more accessible loan online and get approval within hours. Personal loans may even enable people rejected by conventional institutions to improve their financial situation. However, they come with their own caveats.  Are these internet-assisted forms of credit suitable for everyone? Despite their tempting accessibility, you should weigh up the pros and cons carefully. Here is a look at the main upsides and downsides of such finance tools.  The Benefits: Easier to obtain Personal loans are associated with softer requirements.  Quicker  Approval takes from a few hours to a few days. Why Caution is Key Borrowers whose relationship with credit in the past was far from flawless, are normally dismissed by conventional lenders. Hence, they are left with no options except for the extremely precarious payday offers and the less risky personal loans.  However, the requirements for the latter may also include collateral and favorable credit history. Although some lenders look at just the income and credit score, others are more cautious in their selection of applicants. This explains why personal loans look extremely tempting, especially to borrowers with poor credit history. In…

Personal Loans

Personal Loans

How Personal Loans Measure Up Against Old-School Bank Loans

When you are in dire financial straits or need funds for a large purchase, there are usually several options at hand. First, there are family and friends who could be asked for money. Secondly, there are banks with their conventional forms of credit. And thirdly, there are online-based lenders providing so-called personal loans.  While asking friends for help brings embarrassment and possible souring of relationships, impersonal institutions look like a better option. But should you take out an old-school loan, such as a mortgage, or opt for modern alternatives? Here is a comparison between the two.  Who can apply Personal credit is undeniably easier to obtain due to more lenient requirements for qualifying. Banks not only check an applicant’s credit score, their income and background, they also ask for collateral. This means that if you fall back on your payments, the lender will seize your property (vehicle, home, etc.) that serves as a guarantee of repayment.  Personal loan providers, on the other hand, will focus on just your income and credit history. Collateral is not always required. Moreover, the credit score they accept as the threshold is often lower. This means that if your relationship with borrowed money was turbulent…

Personal Loans