When you need to take out a personal loan, going through an online lender opens up more choices beyond traditional banks. Online lenders cater to a wider range of borrower situations with varied loan amounts, rates, terms, and qualification factors. Read on for tips to evaluate and compare online personal loan offers suited to your needs.
Higher Loan Amounts
Online lenders will often approve personal loans up to $100,000, whereas banks typically cap at $50,000. This makes online loans better for consolidating high-balance credit card debt, doing major home improvements, or covering uniquely large expenses.
The key is borrowing only what you need rather than maxing out the highest amount you qualify for. Make sure you can manage the monthly payments over the multi-year loan term.
More Rate and Term Options
In addition to offering personalized rates based on your credit profile, many online lenders give you more flexibility in choosing loan structures. This includes options like:
– Term lengths from 2 to 7 years
– Fixed and variable rate loans
– Regular, bi-weekly, or weekly payment schedules
A longer term means a lower monthly payment but higher overall interest paid. Optimal terms depend on your budget and financial goals. Compare choices across multiple lenders to mix and match offers.
Qualify With Alternative Lender Types
Beyond traditional installment loan companies, specialized online lenders cater to non-prime borrowers yet still offer competitive rates. These include:
– Peer-to-peer lending marketplaces
– Payday alternative loans
– Bad credit lenders
– Lenders who consider alternative data for approval decisions
Make sure to compare all-in APR rates across different loan types. Fees can sometimes offset special low rate promotions.
Getting Pre-Qualified Gives You Power
One of the best parts of online loan shopping is that you can easily compare personalized rate and term offers across multiple lenders with a soft credit check. Soft checks don’t affect your credit score. Once you have current rate and fee information, you have the power to cherry pick the most appealing loan packages for your situation.
Frequently Asked Questions
Q1: What are common uses for online personal loans?
A: Paying off high-interest credit card balances, debt consolidation, make home repairs and improvements, pay medical bills, finance a wedding, moving or relocation expenses, pay tuition, or fund a vacation.
Q2: What interest rates are typical for online personal loans?
A: For borrowers with good credit (690+ score), personal loan rates from online lenders range from around 5% to 36% APR based on eligibility. Lower end rates go to the most qualified applicants.
Q3: Can I get a same day personal loan?
A: While approval can be very fast with some online lenders, most specify that it takes at least 1-3 business days to fund approved loans and transmit the money into checking accounts. Very few offer true same business day funding.
Q4: How much money can I get with a personal loan?
A: Online loan amounts range from $1,000 on the low end and up to $100,000 from some lenders. Banks usually cap personal loans at $50,000 for well qualified borrowers.
The Bottom Line
Online lenders empower you to access higher amounts with more flexible rates and terms tailored to your situation. Pre-qualifying and fee-free rate checking make it easy to evaluate choices from multiple platforms. Once approved, funds may hit your bank account within days.