If you’ve been thinking about taking out a business or personal loan, you may have noticed that you now have options beyond a traditional bank. Online loan companies are growing in popularity, and working with direct lenders can create some significant benefits.
But are online loans with a direct lender are safe? And why would you want to choose a direct lender over a traditional bank? The following guide will answer all of these questions and more.
Are Online Loans Legit? What is an Example of Direct Lending?
Online loans allow you to go through the entire process of applying for and receiving funding without ever having to make in-person contact or set foot into a bank or other financial institution. For example, at Zinch, you can start the process by giving us a call or completing our simple online form. Then, you’ll have a quick chat with one of our financing specialists who will help you choose the right product for you. Once you’ve made your selection, you’ll sign your loan documents and have the funds deposited directly into your bank account. There’s no cost to apply and the entire approval process is typically completed within 24 hours from the time you submit your information.
Not only is this quite convenient, but taking out a loan from an online lender is just as safe as using a traditional bank–as long as you choose a reputable lending company. It’s always smart to spend some time vetting the lender by checking their information and reading online reviews.
Benefits of Using Direct Lenders for Online Loans
Applying for an online loan with a direct lender is often faster, easier, and offers more flexibility. Here’s a closer look at some of the top benefits you may experience if you choose to take out an online loan with a direct lender.
1. Better Interest Rates and Terms
Online lenders don’t have to pay for overhead costs like buildings and excess staff. In some cases, this may allow them to offer lower interest rates and better terms. As you research your options, you may notice a significant difference between the offers made by traditional lending institutions vs. online-only lenders.
2. Targeted Products
Many online lenders focus on one or two specific types of loans, such as online small business loans or online loans with no credit/no credit check. This allows you to seek out a lender who is specifically looking for borrowers just like you. If you’re concerned about your credit score or you’re looking for a specific type of loan, there’s a good chance you’ll be able to find a lender that’s a great fit for you.
3. Faster Processing
When it comes to online loans, easy approval is one of the top benefits. Most online lenders realize that their clients want to get the money they need quickly, without a lot of hassle. For this reason, they often process loan applications using your basic information and without requiring extensive documentation. Some will also forego a credit check altogether.
4. Less Focus on Credit
It’s common for direct lenders to offer online loans, bad credit, and same-day loans with no limits on what you can do with the money. This provides a significant amount of flexibility for borrowers who need cash fast but may not have perfect credit. Online loans for small business owners are a convenient way to get through slow times, meet payroll, or make an investment back into your business.
5. Less Cross-Selling
Often, traditional banks offer lower interest rate loans with the hopes that they’ll be able to sell you other products or services in the future. If you choose to take out personal or small business loans online, there may be less of a chance that you’ll receive a bunch of solicitations for other products and services. This can help protect your privacy and shield you from annoying phone calls.
Explore Your Online Loan Options
Zinch has been providing fast and convenient financing to small business owners since 2004. Since then, we’ve worked hard to earn our reputation as a trustworthy and dependable online lender. Contact us at (714) 500-6622 to learn more about our small business loan options. You could qualify for up to $250,000 in just 24 hours.
