So, you’ve had a long, hard think about the type of finance you want to obtain? If you’ve decided that you want to get a personal loan, the next step is to get the ball rolling. If you don’t have much experience in the financial sector, it can sometimes be hard to understand where is best to start.
It’s important to be aware of the best ways to approach the lending process. If you’re wondering how to get a personal loan, this guide has been made specifically for you. We break down the entire process to make it significantly easier to understand. We want to ensure that our readers know exactly what to expect when they begin their personal loan journey.
It might sound difficult, but getting a personal loan is much simpler than you may think. It doesn’t take very much time to apply for a loan if you know what you’re doing. Make sure to read and review all the information provided in this article prior to making any serious decisions. You don’t want to rush into a decision and make a mistake based off ignorance – all the information you’ll ever need on how to get a personal loan is right here!
Choose the Type of Lender You Want to Work With
The first step in understanding how to get a personal loan is deciding what type of lender you want to work with. In the modern world, you have two main choices when it comes to personal loan lenders. You can opt to work with online lenders or traditional bank lenders. Both of these different lender types have their own advantages, so it’s important to make sure that you know which one is best for you and your situation.
We will explore each of these two lenders below so you can have a better idea about which one may be most suited to you.
Traditional lenders are typically large banks that have considerable lending power. These banks are established and provide a lot of the liquidity you see in the lending markets. They typically provide a wide variety of different lending products, which is good for those who want to have a few different options. Banks often have longer applications processes, they will typically want more information from you. They are much more risk averse than some of the newer lenders in the market.
Below we provide a check list of characteristics that will indicate that you should be working with a traditional lender:
- Face-to-Face Interaction – If you want to meet with your lender and have face-to-face interaction to help guide you through the lending process, traditional lenders will often be your best options.
- Reputation – Large, traditional lenders typically have longstanding reputations in the industry. They are well-known by regulators and tend to follow strict lending rules that may not be applicable or enforceable on smaller lenders.
- Other Services – Traditional lenders will provide other services as well, which can be good for someone who is looking for additional services along with their loan. This could also include the fact that your current bank may be a traditional lender. Working with them may be more convenient.
- Easier to Secure Loan – It is much easier to secure a loan against an asset if you work with a traditional lender. These types of lenders are much readier to accommodate a complicated secured loan than an online lender might be.
Online lenders on the other hand are relatively new to the game. They provide their clients with a different approach to lending. They don’t have physical locations, so the entire process is taken care of online. You have to apply through their website’s portal. It’s very important that you understand the differences between these two lenders. Online lenders tend to be more niche, so they offer different types of benefits. They are less conservative with their money, as they are competing heavily with one another. You will find there is plenty of opportunity to borrow from these types of lenders.
Below are some characteristics that will indicate whether or not you would be likely to enjoy working with an online lender:
- Fast Application – Online personal loan applications tend to be much quicker than traditional loan applications. You will be pleased to find that many applications take less than ten minutes, which is a considerably short time when compared with other traditional lenders.
- Fast Decision – You will also tend to find out if you have been approved in just a matter of minutes. On the other hand, many traditional lenders can take days or weeks to provide you with the approval you need to move forward.
- Fast Capital – It’s not just the application that is fast, you will also get your money quite quickly if you end up working with an online lender. Many provide capital within 24 hours of approval. They do so with electronic bank transfers.
- More Flexible – At the end of the day, online lenders are much more flexible. They provide loans to people with many different credit scores, you’ll be sure to find someone that is willing to lend to you regardless of your background.
Uses for Small Personal Loans
There are a variety of different reasons that people end up getting personal loans. Small personal loans can be used for a variety of different things. There aren’t any restrictions on what you can use your personal loan for. So, using it for a variety of different reasons isn’t an issue. We thought it might be useful to outline some different ways our readers use small personal loans. Check it out below.
Once you have found various lenders that are offering good rates and low fees, it’s time to determine who the most reputable company is. Head to Consumer Affairs or the Better Business Bureau to see which lenders have the best reputation. These companies provide their readers with the ability to review other firms they have worked with. They ensure that you don’t get ripped off by a company that doesn’t act ethically. It’s important to work with a firm that has a great reputation. Not handling customers well is a bigger deal than you think.
While this tends to be a bigger issue in the online lending community, where regulation is limited, it also happens in the traditional lending space. Don’t assume because you’re working with a big bank that they are a great company to work with – always double check before making any financial agreements.
So, if you’ve opted to work with a traditional lender, you’re probably wondering how to get a personal loan. The process is really quite simple, we will explore it in further detail in this section. If you’re wondering how to get a personal loan with a traditional lender, you’ll want to make sure to read this section.
Step 1: Prepare
If you’ve done your due diligence and decided which lender you’re going to work with, the next step is to prepare for your loan application. You should make sure to get all the relevant information together. You will typically need a proof of income, bank statements, SSNs, proof of address, and other forms. You should ask the bank which information you need to bring prior to attending.
If you end up bringig the wrong documents, the whole process will have to begin again. Make sure you know exactly what is needed. Also, check your credit report to make sure you know what your credit score is prior to heading to the bank. You don’t want to have any surprises once you get there, and you should be able to explain everything on your report.
Step 2: Schedule a Meeting
While you can often walk into a bank branch and apply for a personal loan, we suggest that you schedule a meeting so that a lending specialist sets time aside to speak with you. Call your local branch and tell them you’d like to meet in the next few days to discuss a loan – they will most likely suggest an appropriate time.
Step 3: Head to the Bank
On the day of your meeting, head to the bank with all your documents and information. You will most likely have to sit down with a representative and speak to them about your loan. The entire process should take under an hour if you get started on the right foot.
Step 4: Wait for a Decision
If the bank is not able to offer you a decision straight away, they’ll probably have one back to you in the next few days. Don’t hesitate to call up and ask for a status on the loan. Being proactive isn’t a negative trait.
If you’ve opted to work with an online lender, the process tends to be much simpler. You won’t have to go through as long of an application process. Once you determine which lender to work with, the process is very straightforward. We will discuss it in further detail below:
Step 1: Head Online
Head to the website of the company that you have decided to work with and open the application. You will want to make sure that you already have all the relevant documents available to provide to your lender if they ask for them. As with traditional lenders, you should make sure you know your credit score before you begin applying. You need to be certain you’re eligible in the first place.
Step 2: Submit Application
Enter in all the information they ask for, and make sure to be truthful throughout the process. Not being truthful can in some instances count as fraud. Make sure to take your time carefully filling in the application. The entire process shouldn’t take more than ten minutes in most instances.
Step 3: Get Your Decision
You will typically get a decision back in just a matter of moments. This is a great turnaround time when compared to traditional lenders. Sometimes you may end up not being approved straight away, don’t be worried if it takes them a day to sort through your information. Although this is rare.
Step 4: Organize Transfer
Once you have been approved, you will need to organize a transfer of funds so that you can receive the money that you have been lent. You will typically give them your bank details and they will organize an electronic transfer of funds. This can often take less than 24 hours to complete.
If you were trying to find out how to get a personal loan, you should have all the answers you need after reading this guide. As you can see, the process is fairly straightforward once you get the ball rolling. You just need to set aside some time to assess which type of loan and lender is best suited to you. Don’t waste your time – make sure to head straight to finding out what you best options are.
We’ve created a list of the most reputable lenders in the personal loans industry. If you’re having trouble narrowing down who you’d like to work with, make sure to check out the names that we’ve provided. We make sure to provide non-biased assessments for our readers so that people know who to work with.
No matter what you do, don’t apply for multiple loans at once. It can be extremely easy to get ahead of yourself, especially if you’re working with online lenders. Don’t send out more than one application at a time. Lenders can see that you’ve applied for other finance and will view this behavior as suspicious. They don’t want to provide people with money if they believe they are trying to get capital in a hurry – it’s a bad sign.
Lastly, make sure to use your money wisely – borrowing can be great for your financial health if it’s done in the right way!
How to Apply for a Personal Loan
A personal loan can be the answer to your financial problems. We can help you find the answers you need when it comes to applying and getting your personal loan.
How to apply for a personal loan?
You can apply for a personal loan at most banks or credit unions. Now you can even apply for personal loans online through online lenders.
How to apply for a personal loan with bad credit?
If you have bad credit, you may be approved at the cost of higher interest rates and lower loan amounts. Credit Unions usually give better options for people with bad credit.
What do I need to apply for personal loan?
In most cases, all you need is a form of identification (driver’s license, social security, etc.), a proof of address and proof of income.
How to apply for a personal loan at a bank?
You can apply for a personal loan at a bank by making an appointment to talk with a personal banker. Make sure to bring a form of identification, proof of address and proof of income.
Does applying for personal loans affect your credit score?
Since a credit check is always done with your loan application, your credit score lowers. If you’re approved, your credit score lowers further due to your increased debt-to-income ratio.
What to bring when applying for a personal loan?
When applying for a personal loan, you should bring a form of identification, proof of address and proof of income (such as paychecks or bank statements).
Is it better to apply for a loan in person?
Applying for a loan in person or online has similar outcomes. Even online banks have customer service representatives to help answer all your questions. It’s best to gather quotes to see who can provide the best rates.
How to apply for a small personal loan?
You can apply for a small personal loan by going to your local bank, credit union or even online lender to apply for a personal loan.
How to apply for a personal loan with no credit?
Lenders usually require previous credit to be established before you apply for your personal loan. However, some new online vendors are accepting people with no credit.
Can I apply for multiple personal loans?
Yes, you can apply for multiple loans. However, each time you apply, the lender will assess your situation and take into consideration any loans you already have.
How can I apply for a personal loan online?
Applying for a personal loan online is much like applying in person. You can start the application process by going to your lender’s website and finding their online loan application.
How to apply for a personal loan with poor credit?
People with poor credit will have a harder time applying for a loan. However, you may be able to get a loan with higher interest rates. Credit unions also offer better rates for people with low rates.
How often does a person apply for a loan?
You can apply for a loan as often as you’d like. Each time you apply, your previous loan history and credit are considered before being approved.
How to apply for personal loan consolidation?
There are a variety of uses for a personal loan, one of them being debt consolidation. You can apply for a consolidation loan at your bank, credit union or online lender.
Can I apply for 2 personal loans?
Yes, you can apply for 2 personal loans. However, keep in mind your credit goes down and your debt-to-ratio increases with each loan, lowering your credit score.
Where can I apply for a secured personal loan?
You can apply for a secured personal loan at banks, credit unions and online lenders. Compare estimates between each to find the best deal.
How can I apply for a small personal loan?
You can apply for a small personal loan at most banks, credit unions or online lenders. Smaller loans are also easier to be approved for.
Where can I apply for a small personal loan?
You can apply at your local bank or credit union. Now you can even apply for personal loans online through online lenders.
How to apply for 2,000 personal loan?
You can apply for a small personal loan of $2,000 at most banks, credit unions and online lenders.
Does applying for multiple personal loan affect credit?
Yes, your credit score will lower as credit checks and higher debt-to-income ratios will lower your credit score. However, with on-time payments, your credit score will go back up.
How does applying for a personal loan affect credit score?
Applying for a personal loan does affect your credit score, as the lender will have to do a credit check. It typically lowers your credit score only by a few points.
Getting the Best Deal On your Personal Loan
If you’re aiming to get the best deal, there’s a few details you should pay close attention to before you apply for your loan. Read the following frequently asked questions to see how you can get the best deal.
What to look for when applying for a personal loan?
When applying for a personal loan, you should take into consideration the interest rates and the fees that come with the loan as well as how much they’re willing to lend you.
How to prepare to apply for a personal loan?
You can prepare yourself by paying off any existing debts (to lower your debt-to-income ratio) and staying away from credit-lowering activities, such as getting a new credit card.
When to apply for a personal loan?
To get the best deal, you should apply for a personal loan when you have a steady income, a good credit score, and your debt is low.
How to apply for personal loans with ok credit?
With OK credit, you can expect to have high interest rates and lower loan amounts. Credit unions usually give better rates for people with lower credit scores.
What questions to ask before applying for a personal loan?
Before applying, you should ask about the loan’s interest rates, fees, and payment terms.
Does applying for multiple personal loan affect credit score in 2018?
Yes, your credit score is lowered each time a lender checks your credit score, and it’s best to get estimates before applying for loans.
Can I apply for home loan and personal loan together?
It’s possible. To be approved for both, you’ll need to have a high credit score and a low debt-to-income ratio.
What's better applying for a personal loan or second mortgage?
It depends on your needs. Personal loans will give you smaller amounts of money. A mortgage will give you a higher loan amount, but your house will be taken if you can’t pay it off.
Should I apply for a loan online or in person?
Sometimes online lenders can offer you lower rates due to lower operating costs, but it’s not always true. It’s best to get multiple estimates (online and offline) and go with the best offer.
How much personal loan should I apply for?
You should apply only for the amount you need to avoid paying interest on money you don’t need. Ask your lender if they can work with your desired loan amount.
There are a few other frequently asked questions when it comes to applying for personal loans, including questions on cosigners, veterans and applying online:
Can a retired person apply for a personal loan?
If you have Social Security benefits, a pension or retirement fund, you can still apply for a personal loan since you have money coming in to pay it back.
Where to apply for minority loan for personal property?
Minority loans are usually aimed towards business owners, but minorities can apply for personal loans and be approved if they have good credit, a steady income and a low debt-to-income ratio.
How to dress when applying for a personal loan?
Your eligibility for a personal loan is based on your credit and other financial factors, not how you dress. However, it wouldn’t hurt to dress well to set a good impression.
Where to apply for a personal loan online?
There are a number of websites you can apply for personal loans through. To find the best rates, you can search “Best online personal loan rates”.
How to apply for a personal loan with a cosigner?
Applying for a loan with a cosigner is similar to applying to a normal personal loan. The only difference is you bring a cosigner to improve your chances of getting the loan.
Can housewife apply for personal loan?
Housewives will likely be turned down for their lack of income. Instead, housewives can try to apply with a cosigner to increase their chances of getting their loan accepted.
Can you apply for a personal loan without a job?
Most lenders require a steady income to approve your loan (to ensure you pay them back) and will turn you down if you have no job.
When applying for a loan, do you use personal household income?
When applying for a loan, you use your own income. If there is a cosigner to the loan, their income is considered as well.
How to apply for a VA personal loan?
If you are a veteran, you can apply for a VA personal loan even with a lower credit score. Some banks, credit unions and online lenders offer VA personal loans.
How often can you apply for a personal loan?
You can apply for a personal loan as often as you’re approved. Keep in mind your credit score goes down with each credit check as well as how much debt you have.
Can you apply for a personal loan over the phone?
Yes, you can apply for a personal loan over the phone. Now online lenders even allow you to apply online, without the need to come into an office.
Christine has a solid background in personal finance as she spent the last eight years working at one of the biggest banks in the US. She managed her own team of financial advisors that helped hundreds of people with their financing needs. Her innate understanding of different financial products and loans helped her move up the ranks quickly after graduating with a degree in Business Administration.