When people think of applying for a loan to finance a holiday, a wedding, a car, debt consolidation or any number of purposes, their first thought is to approach one of the big banks. However, banks are not the only option when it comes to personal finance. Private lenders also offer fast cash loans at competitive rates and terms.
In this post, we’ll take a look at Personal Loans, as well as a Pawn Loan option, and the general procedure and advantages of applying for these types of loans with a private lender.
What Can You Use a Personal Loan From a Private Lender For?
While on the surface it sounds like you can borrow money via a Personal Loan and use it for anything you like. While this is “somewhat” true, lenders will always ask you what you want the money for, what the majority of the loan will be spent on. However, this list will vary from lender to lender, whether they are a bank or a company in the private lending sector.
If you want a Personal Loan for a specific purpose and you’re unsure whether it fits the lender’s criteria, just ask them. That way there will be no confusion about what you can use the money for.
The Online Procedure To Apply For Loans
Just about every lender in Australia will allow you to apply for a Personal Loan online and it’s the same with most private lenders as well. This makes the application process super convenient as you don’t have to travel anywhere to do it, or physically fill out forms. You simply follow the series of questions asked in the online application and upload any requested documents.
The important point to note about the application process for Personal Loans with private lenders, compared to banks, is there tends to be fewer questions to answer, making the application quicker and easier to complete.
Private lenders are all about speed and this is one area where they deliver on that.
How Much Money Can You Borrow?
Once more, this varies according to who you apply with. Banks tend to offer larger sums of money when it comes to Personal Loans, but they also tend to have much higher minimum loan amounts.
Private lenders offer smaller Personal Loans when it comes to the standard type of Personal Loan, but the advantage is you can borrow amounts in the $100s instead of the $1,000s, if that’s all you need. For a standard loan, the maximum will usually be in the $5K to $25K range.
The first thing you really need to figure out is how much money you need and how long you need to pay back the loan. Once that’s nailed down, then you’ll know whether a private lender Personal Loan is the right fit for you.
What Documents Are Required When You Apply?
Again, this can vary between lenders, but let’s try and answer that question in a general sense.
There isn’t a lot of documentation required, but the standard documents for a Personal Loan include:
- ID, such as driver’s licence, passport, birth certificate, utility bills in your name
- Proof of income, as in payslips from employers or documentation from your accountant that proves how much you earn as a sole trader or from your business
- Your bank details
This is the kind of basic documentation you would need to have regardless of which lender you deal with. Depending on your circumstances, further documents might be required, but generally the process with private lenders is very straightforward.
Private Lender Personal Loans Are Fast Cash Loans
It was mentioned earlier in the article that the private lending sector focuses a lot of attention on providing very responsive services. Speed is one of the competitive advantages they have over the banks. If you need your money fast, then a private lender Personal Loan could be the way to go.
Let’s say you have an emergency situation on your hands and need the money within the next day or two to resolve your problem or pay for medical expenses. Banks can simply just take too long to process applications and make a decision.
A private lender, on the other hand, focuses on quick turnaround times, so if you get your loan application in early enough with the required supporting documentation, it could be processed and approved on the same day, with the money deposited in your bank account at the end of the day or the very next business day.
Why You Might Want To Consider a Pawn Loan Instead
There is another option instead of getting a Personal Loan, and that’s to get a Pawn Loan from a private lender that specialises in these types of loans.
With Pawn Loans, you use an item as security against the loan amount. The lender takes possession of that item and gives it back to you once you repay the loan in full.
Pawn Loans with private lenders are on a larger scale and one of the most common items used as collateral for the loan is a motor vehicle. As a guide, you can borrow up to 60% of the vehicle’s current market value and have up to 3 months to repay the loan.
Pawn Loans are handy when you might be out of work temporarily or don’t have a very good credit history, as there are no credit or employment checks. So long as you have a vehicle, an expensive watch, jewellery or even business equipment, it’s a much more straightforward and guaranteed way of getting finance.
A Pawn Loan document checklist includes:
- You need to provide identification
- Your vehicle’s registration papers
Pawn Loans are a very fast and hassle-free way of getting your hands on the cash you need, when you need it. So long as you have a vehicle or some other item of significant resale value, you’ll be good to go to get approved for a Pawn Loan.
At Cashify, we offer both Personal Loans and Pawn Loans, so if you’re in the market for finance, give us a call first.
Disclaimer: Please note this content is of general nature only and does not take into account your personal objectives, financial situations or needs. For advice tailored to your financial situation, it is advised that you seek guidance from an accountant or financial advisor. The information contained in this article is correct at the date of publication.