Sometimes you need some amount of money
urgently or for emergency and you don't have time to spend with the
long process of availing a loan from a bank. Well you can now have
the cash you need in less time through an instant personal loan. This
type of loan is provided by many payday loan companies and other
financial institutions. Instant personal loan is intended for borrowers who need to
have cash instantly without too much requirement.
Lenders have different limits in
terms of the amount of money that can be loaned. They also differ on
the interest rates.
If you want to know how to avail of
the instant personal loan, here is a guide on the procedures. Before
applying for the loan, it is important that you have a proof of
income or a certificate that you are employed. It is best if you
have a copy of your pay slip. In some instances, the lender may ask
for collateral so be ready when needed.
You must determine how much money you
need. Remember instant personal loans have very high interests so
make sure you only borrow the amount you need to save you from
paying too much for interests. There are lenders that provide lower
interest but they have stricter application procedures.
The next thing to do is to look for
the right lender. You can search through the internet or you may
give them a call or rather visit a lender near your area. You must
inquire on the interest rates, terms of payment and other documents
necessary for the application. Lenders may need to check your credit
standing so be prepared for it.
Before signing the contract, ask your
lender what are other fees to be paid aside from the loan and
interest rate. This will ensure that your lender does not have any
hidden charges that might surprise you in the end.
After you have read all the details,
you may now proceed and complete the forms required for the
application. It would be best if you have your bank account number
because some lenders require that the money will be deposited
directly to your bank, although some lenders will just hand it over
to you in cash.
After you have received your instant
personal loan, make sure to use it according to your original plan.
The moment you have the cash, it is advisable to pay your loan
immediately to avoid the burden of paying a high interest rate. For
such consideration, it is ideal to avail of the loan to lenders that
can provide terms with no penalty for early payments.
An instant personal loan can be
availed quickly but the consequence is the high interest rate. So if
you have other alternatives, try to exert all resources before
considering this type of loan otherwise you will be suffering from
spending too much money just for the interest. The instant personal
loan should be your last resort of action after everything else
Are you in need of some extra money?
Sometimes you just have to spend the money that you don't have.
There are many people that are turning down the credit cards and
turning to small, closed-end, unsecured loans instead.
Approximately 1/5 of all non-mortgage
installment loans are personal loans, says Jane C. Yoa, managing
director for surveys and statistics for the American Bankers
Association. "It's a product that banks are finding a demand for in
the market," she says.
Many banks don't advertise that they
offer unsecured loans because they are not as profitable as other
loans. They bank would rather offer a credit card because it is a
long term commitment, ongoing in many cases.
Using a credit card for short-term
loans isn't the best option for the typical borrower. The high
interest rate can accumulate more in interest payments. Plus, you
must be very disciplined to only use the card for that loan. You
have to pay it off like a loan; minimum payments could take you
First, you need to decide how much
money you really need. Look for the least amount of money that will
make everything work out. Look at your credit situation and decide
if you truly can afford one more loan. If you don't have an
emergency fund, you may find that you have few other
Once you know that you will need to
take out a loan, start shopping around. Terms can vary and you want
to find the best rate possible. Call around and talk to all the
banks in your area, plus some national lenders. Don't just go to a
payday lender, talk with your bank or credit union first.
What kind of rates should you look
for? Two year personal bank loans are averaging above 11.8% for
interest rates. Credit unions may offer better rates and terms than
banks, because they often are non-profit institutions.
Short-term unsecured loans can be
found at 96% of all credit unions, and many make loans in amounts
less than $500. Most people borrow an average of $2,300. Many loans
under $500 can be made with a quick limited credit check.
When it comes to your terms, look at
the total cost of the credit, not just the monthly payments. While
you may want to pay the least amount possible per month, a longer
payback period means you pay much more in interest.
Look for any hidden fees and charges.
You don't want to pay for credit insurance, buying clubs or other
extra fees. If you don't understand what a fee is going towards,
make the loan officer explain it. Ask about each charge and
Read everything carefully before you
sign it. If you are told something different than what is in
writing, only trust the writing. Once you have signed something, any
verbal conversations mean nothing. You have no agreements unless
they are in writing.
Don't let the officer talk you into
borrowing more money than you need. Recently a loan officer offered
me $5,000 more than I was asking to borrow. I didn't need the
temptation, the added interest costs or the extra debt, so I
politely refused. Many officers receive a commission based on the
loans they approve. Know what you need to borrow and stick with that
Often, the bank will offer you a
credit card instead of an unsecured loan. This isn't a great idea.
The rates aren't fixed and can change during the course of the loan.
Credit cards are considered revolving credit, which means you have
no set repayment date. It might sound attractive, but in two years
you could be paying 23% interest. Can you afford the risk? Instead,
ask for a specific loan amount with a fixed interest rate and a
And finally, start saving! Next time
you won't need to take out a loan if you already have the money in a
savings account. While you are at the bank, go ahead and set it up.