What are the benefits of online loans?
- Online loans, at least if they are distributed by a direct bank, are significantly cheaper than traditional loans. This is because direct banks have no or hardly any branches of their own, thus saving upkeep costs that they can pass on to their customers. But even traditional banks offer online customers cheaper deals. The reason is the greater competition in the online business. In addition, customers who do not seek personal contact with their consultant incur less cost.
- The application is sometimes less complicated than in the store. The customer can read through the conditions in peace, without being put under pressure by his bank advisor. Many succeed in making a more responsible decision that makes them feel better.
- The processing of online loans is also much faster. Many providers even make it possible to receive a refusal or rejection immediately after entering the credit request and the financial situation of the applicant. In addition, the money is often much faster after an instant commitment on the account.
What disadvantages does an online loan have?
- With online loans many borrowers miss the personal advice. Especially customers who are not well-informed financially, feel so alone and have difficulty completing a meaningful loan.
- Due to the lack of customer advisors, borrowers have to raise a much higher level of individual responsibility. Repayment schedules, the debt limit and other issues can not be discussed with a competent adviser. That’s why consumers need to pay extra attention to not exceeding their financial limits when it comes to online credit.
- Another problem is that there are not only legitimate loan offers on the Internet. Borrowers therefore have to exercise caution and distance themselves from tempting offers. A quick check on whether the potential lender is reputable is essential.
- In addition, customers looking for a loan should not unhesitatingly take out insurance. Many online loans offer additional services that are too expensive and unnecessary at the same time.
How do I record an online loan?
The most important step is to find the best loan offer. Consumers should compare as many similar offers as possible. However, indiscriminate loans should not be applied for. Depending on the nature of the application, it will be registered in the Schufa and can thus significantly impair the assessment of creditworthiness.
2. Check credit
Once the best loan is found, prospective borrowers should study the fine print. Sometimes the supposedly cheapest loan turns out to be unnecessarily expensive due to hidden costs or unfavorable conditions.
3. Apply for credit
Applying for a loan basically works the same way as in a branch office. The only difference is that the data can be entered directly into online forms and sent with a mouse click uncomplicated. The requested data must be true.
4. How does the contract become valid?
How the loan contract can be concluded online depends on the provider. Partially the contract will be sent by post. However, some also allow the application to be completed online. However, the required documents and the signed contract must be scanned and sent by fax or e-mail to the bank.