Three Steps to Apply for a Personal loan
In just three steps you can get approval for personal loans. The process can be accelerated with these tips.
Although applying to for a loan is more complicated than applying for credit card, our three-step guide can help you answer all your queries and find the right personal loans for you.
Step 1: Compare the offers and pre-qualify
Before you submit an application, you can review the terms, rate and monthly payments that you may be eligible for before you sign up. Most banks and online lenders offer pre-qualification. It takes five minutes to complete offers from Bridge.
What credit score do I have if pre-qualifying?
A soft inquiry will determine if you’re eligible for a personal lender. This does NOT affect credit scores.
Your credit score can play a big role in deciding whether you are eligible for personal loans. Before you apply for a personal mortgage, you can get a credit report free of charge.
There are lenders that will lend to borrowers with very poor credit. Lenders that cater to borrowers with poor credit must have a FICO score less than 629.
What are the requirements of being pre-qualified in order to obtain a personal loan
The following information is required to be prequalified
- The loan can be used on home improvements, consolidating debt or for moving costs.
- Requested loan amount. Lenders will typically offer personal loans starting at $1,000 up to $50,000.
- The amount that you want to pay monthly. Typically, terms last between 2 and 5 years.
- Personal information like name, address or date of birth.
- Pre-qualification might include the need for your Social Security number.
How long does pre-qualification take?
Once you have submitted your information online, pre-qualification will take only seconds. If you’re eligible for a loan a new page with your rates, terms and conditions will be made available.
A lender could send you an e-mail with contact information to customer support and a list that outlines the next steps in your application.
Step 2; Get your documents and choose your loan
You have now received offers from several lenders. It is time to examine your options, and to decide which loan application should be submitted.
How do personal lenders compare?
When you choose a personal lender, make sure to pay attention to the annual per cent rate, also known by the APR. It is your total borrowing price. This rate includes both interest rate and additional fees. The APR determines loan costs. The APR may differ depending on your income or credit score.
It is important that you can afford your monthly payments. Take a look at the features that matter most to you.
What documentation do you need to apply in order to get a loan?
Once you have determined the terms and rate of a loan that is right for you, it’s time to apply. You may need some, or all, of these items.
- Photo ID
- Documentation required to verify address
- You can prove your employment status
- This includes your education record, including the highest degree and graduation date.
- Financial information such as total saving, retirement assets, and outstanding debts.
- If the prequalification did not include the provision of a social security number,
Step 3- Submit your request to be funded
Before you submit, ensure that all terms and conditions are read carefully.
The agreement guarantees all information you provide on your application has been accurate. It allows lenders to contact your employer to verify your details or pull your credit reports.
How will my loan approval affect my credit score
A formal loan inquiry is initiated by a formal loan application. This is unlike pre-qualifying. This can affect your FICO score as it could decrease up to 5 points. The inquiry will stay on file for just under two decades.
What’s the average time it takes for my application approval?
If everything goes according plan, you may be approved on the same day. Sometimes, additional documents may be required in order to get approval. In these situations, the lender may contact your directly to inform what additional documents you are required to submit.
How long will it take before it is funded?
After you have been approved, the lender you choose will decide how quickly you get your money. Many online lenders can offer same-day funding. Most traditional lenders (banks), will send money within five business days.
Your first payment will arrive within 30 business days once you have been funded. If you’ve chosen to receive automatic bank payments, funds can be debited directly from your bank account. Your monthly payments should be added to your budget to ensure you are on track with your debt repayments.