Individual lenders offer numerous advantages, however, banks also have their own benefits. Both forms of financing have their own set of advantages and disadvantages. Continue reading to discover which choice suits your needs best.
Personal lenders have many benefits, the main benefits to using a personal loan company depend on how much you are looking to borrow, how quickly you are looking to acquire the funds and what you look like financially. A personal loan or payday loan company will be able to do a much quicker assessment of an application than a bank which will allow you to receive the funds much faster.
PROS AND CONS OF GETTING LOANS FROM A LOAN LENDER
Payday lenders are also somewhat more lenient in terms of your lending criteria. Where a bank may be unable to lend if you are solely on centrelink or only working casually, a personal loan company may be able to help. Payday lenders have more relaxed lending criteria compared to banks. While banks may have restrictions for those solely on Centrelink or working casually, a personal loan company may be able to provide assistance. Applying for a loan through a payday lender is generally faster than through a bank, as they require less information and can provide an answer in under 2 hours. Some personal lenders can also disperse funds into your account on the same day. Despite the thorough assessment process, the speed and flexibility of payday lenders can be beneficial for those in need of quick financial assistance.
PROS AND CONS OF GETTING LOANS FROM BANKS
While it may take longer to go through a bank for a loan, there are several advantages. You don't have to use the bank where you have accounts to receive these benefits. Banks can offer lower interest rates compared to personal lenders, who are often limited in how much they can charge. Additionally, banks can typically offer higher loan amounts without requiring collateral, unlike personal lenders who may require a vehicle for larger loans. Banks may also provide more flexibility in repayment terms and loan durations, as they are accustomed to dealing with larger loan amounts and longer repayment periods compared to payday loans.
SO, WHAT'S THE VERDICT? IS IT BETTER TO GO THROUGH A LENDER OR A BANK?
We discussed the advantages and disadvantages of personal loans and bank loans. Personal loans offer the advantage of quick loan approvals and repayment options, making them suitable for borrowers in urgent need of funds. Bank loans, on the other hand, provide more time for evaluation and typically come with lower interest rates, catering to borrowers seeking loans with lower interest costs. The ultimate choice depends on the borrower's individual preferences and available options.