So, you are thinking about getting an online loan because you like the fact that it gives you direct access to fast money. You are probably thrilled with the idea that you can get instant money to pay for your shopping desire. But before you rush in to send the loan application, there are some basic facts you should know about the loan.
The Good about Online Loan
Some people like the online loan for its quick and easy service. Don’t you love it when you can borrow money without having to go anywhere? Simply send a form and the money will be transferred to you. Not to mention that you don’t have to worry about your tarnished credit reputation. There is nothing to be ashamed of, really, but banks take such matter seriously.
If you are short on cash and you only need a few dollars to get by, this online loan will be the best option because you can borrow the money for a short-term period and you don’t have to worry about any fussy execution or complicated procedure.
The Bad about Online Loan
Yes, the idea of not going through a fussy implementation and difficult process may sound appealing. But not all online loan providers will give you the real facts about the service. At least know your options before you start making a rush decision.
First of all, the interest rate of such loan is pretty high. In fact, when compared to the bank loan, the online loan’s rate is still higher. Because of this, most state governments are implementing the regulation for the highest applicable interest rate, which varies from one state to another.
Second, not all providers are honest and straightforward. There are different ways that they can implement to ‘trap’ you. For instance, they may have their own terms and conditions that are written in a very fine manner and section, making you difficult to read everything. Or they may ‘steal’ from you. The problem with such loan is that they know your bank account and they will deduct your money to pay for your debt. However, some shady providers will take more than you own them. For instance, if you borrow $300 and the interest rate is around 8%, it means that you should be paying them back $324. However, the shady providers may take $330, $350, or even $400 for the money you owe. Third, such loan usually charges additional fees for the loan. It may seem like you only borrow $300, but with the administration fee, interest rate, and others, you may end up borrowing almost $400.
It is important, though, that you really take this matter seriously. The online loan should be taken only as the last resort and only for an emergency situation. Be sure that you borrow the money just about money to get by. A lot of people make mistakes by borrowing money for fun spending. Well, if you don’t want to be caught up in the web of financially tangled mess, never waste the money for fun.