Whether you have been struggling with a credit card debt, unexpected expenses, a much-needed remodeling project for your home or a pile of monthly bills, applying for a personal loan online may help. Personal loans are just like any other types of loan. A borrower requests for a certain amount of money for whatever purpose it may serve. When the loan term is done, the borrower repays the principal with interest and fees. This type of loan is also unsecured, not requiring borrowers for collateral, such as an automobile or house. Loan amounts may range from $1,000 up to $50,000 depending on the lender. This loan is payable in fixed payments, usually over 12 to 60 months. Moreover, rates and terms vary based on your credit.
Apply for a personal loan online if you need immediate financial assistance. There many trusted personal loan lenders that you may want to check out, most of them are members of FDIC. But first, here are the steps you need to take before getting that loan:
- Check your credit score
Having a strong credit history allows you to have a bigger chance of qualifying for a personal loan. In addition, this may give you a chance to score a lower interest rate. You can check your credit score here. Generally speaking, credit scores fall into the following categories:
- 720 and Up – Excellent Credit
- 690-719 – Good credit
- 630-689 – Fair or Average Credit
- 300-629 – Bad Credit
If you have bad credit history, you may want to take some more time and build it up. This may have been a result of missing scheduled payments or the amount of credit you use relative to credit limits. However, you can make a dispute if you believe there are errors regarding your credit score.
- Get pre-qualified for a loan
Want to learn how much you can get in your personal loan? Many lenders offer a soft credit check during the pre-qualification process. This will not affect your credit score. On the other hand, you are not eligible to pre-qualify for a loan if you have too little income, little or no work history, a high debt-to-income ratio and have too many credit applications. If you do not belong to this category, and the lender approves your request for pre-qualification, you may be asked to provide your personal information such as:
- Address, Email, Phone Number
- College Name and Major
- Date of Birth
- Employer’s Name, Work Address and Phone Number
- Monthly Debt Obligations (Rent, Student Loans, Etc.)
- Mother’s Maiden Name
- Previous Addresses
- Social Security Number
- Shop around for personal loans
As mentioned earlier, there are many trusted lenders available. You can get a pre-qualified loan from them. Then you can compare the amounts, monthly payments and interest rates they offer. From there, you can select the option that best suits you.
- Compare your offers with other credit options
Aside from personal loans, there are other types of loans you may want to consider. You can get a credit card with 0% interest for a year or longer if you have a good credit. Nevertheless, if your credit score is a little low, you may opt for a secured loan where collateral is required. This option may get you a better interest rate. You may also ask help from someone and make them as your co-signer if you are having troubles qualifying for a personal loan on your own.
- Read the fine print
It is important that you read the terms and conditions the lender offers. Check for prepayment penalties, automatic withdrawals, payment features or APR surprises. Do not hesitate to ask questions.
Once you have selected your lender and are now ready to apply for a personal loan online, just go to the lender’s website directly. From there, simply fill out the loan application form. Prepare your government-issued ID, proof of income and employment, active bank account as well as other personal information documents. You can easily do this wherever you are and whenever you need it. Plus, you can apply for a personal loan online either through your computer, tablet or smartphone. Wait for the lender to review your application, and if everything else goes smoothly, you can now get your personal loan, usually by the next business day. Depending on the lender, you can either pick up your cash from the lender’s location or the lender will deposit the money into your account.