Introduction: Best Place to Get a Loan and the Top Online Loan Companies
It is the end of the month, and because your car broke down (again) and needed a couple hundred dollars’ worth of repairs, you’re short on rent.
Your landlord has warned you that if you’re late on rent again, you’ll be out the door – and you have neither the time to start searching for another place to live nor the money for an expensive security payment.
Online loan companies offering advance cash loans may be your only option to get you through a tight financial spot, and you may be wondering, “Where is the best place to get a personal loan?”
While many online loan companies have gained a notorious reputation as loan sharks charging exorbitant interest rates, there are reputable places to find decent, advance loans.
The best place to get a loan should help you get through your tight financial situation within killing you in interest or miring you in long-term, inescapable debt.
In this brief article, AdvisoryHQ will look at why it is important to research the best place for a personal loan. We will explain the concept of advance loans or advance cash and then go over who benefits from these personal loans. Finally, we will review a few of the best places for a personal loan.
What Are Advance Loans and Advance Cash?
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According to the Consumer Financial Protection Bureau of the U.S. government, “A payday loan is a short-term loan, generally for $500 or less, that is typically due on your next payday.”
These advance loans are generally given for small amounts, meaning you won’t be able to finance the purchase of a home or a car with a personal loan. They are usually due to be paid back on your next payday, and you may have to give access to your checking account to the lender.
Most advance cash loans have a finance charge of anywhere between $15 and $30 per every one hundred dollars borrowed. This charge usually is not expressed in a typical annual percentage rate (APR) because the loans are often paid off in a couple weeks’ time and also because the interest rate would appear unfavorable.
While you can get a mortgage for as low as 3% APR and a credit card for around 15% APR, on the other hand, a two-week payday loan offered by an online loan company that is charging $30 for every $100 borrowed would come out to 800% APR.
The best place to get a loan may offer you more favorable loan terms and a lower interest rate. If you have a decent credit score and a strong relationship with a bank or credit union, you may even be able to secure an advance loan for several thousand dollars and negotiate a longer term on the loan as well.
Why Should You Do Research on the Best Place for a Personal Loan?
There are thousands of lenders out there all promising to be the best place for personal loans. Unfortunately, not all of these online loan companies offer fair interest rates and terms and conditions on the loans they offer.
Abnormally high interest rates are only one way that some online loan companies make money off unsuspecting borrowers. There are a whole host of other fees and charges that are often tacked on to your original loan.
The best places for personal loans should never charge any sort of prepayment penalties. If you are able to pay off your loan before the term, you should be rewarded for that extra effort – not penalized.
Furthermore, the best place to get personal loans should also never charge any sort of upfront “paperwork” fee or origination fee. Lenders should plan to make the majority of their money from the interest they charge on the loan; not on hefty upfront fees. For example, if you’ve taken out a $200 loan but have to pay a $20 origination fee up front, then that lender is most likely not the best place for a personal loan.
Also, if you are looking for the best place to get a loan, stay away from lending agencies that try to oblige you to purchase additional insurance on that loan.
Many of the supposed best places for personal loans will try to sell you on the need to protect your family from the loan debt through extra insurance fees. Since most advance loans are short term, the chances of anything happening are minimal, and this is typically a trick used by lending agencies to make a few extra dollars.
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Who Benefits from Getting a Personal Loan?
Let’s say you are two hundred dollars short on rent on this month. If you don’t pay on time, your property manager charges a hefty late fee of $150 whereas a personal loan might only charge you $30 to $40 for a $200 loan to be paid back in 2–3 weeks’ time.
Though the interest rate charged by the personal loan is still high, it is much less expensive than being charged the late fee on your rent. As long as you can make a little bit more money next month to break that cycle of debt, a personal loan may help you save hundreds of dollars.
Furthermore, since many banks have increasingly strict standards regarding who can receive a loan, if your credit score isn’t the best but you urgently need a loan for some emergency expense, then the best place to get a loan may very well be through online loan companies with less rigid rules regarding credit standing.
Where Is the Best Place to Get a Personal Loan?
Best Place to Get a Personal Loan: Lending Club
If you have a halfway decent credit score, Lending Club may very well be the best place to get a loan for you. This best place to get a personal loan is actually an online peer-to-peer lending platform, meaning that, instead of a bank, it is an individual who will be offering you a loan.
The minimum credit score required by this best place to get a loan is only 600, which is considerably lower than what most banks or credit unions charge. Furthermore, you can apply for a loan for up to $40,000 – much more than you could ever obtain from a payday loan.
The only downside to this best place to get a personal loan is that it charges an origination fee for loans that ranges from 1% to 6%. Though the 6% is on the high side, if you are applicable for a decent APR, that fee may cancel itself out over time through lower interest payments.
Best Place to Get a Personal Loan: Wells Fargo
If you prefer a big name bank for your loan, Wells Fargo is one of the best places to get a loan, especially if you have already chosen Wells Fargo for your other banking needs. It offers personal loans for anywhere between $3,000 and $100,000 and an annual percentage rate as low as 6.25% for borrowers with good credit standing.
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What makes this one of the best places to get a personal loan, however, is that you can negotiate a loan term anywhere between 12 and 60 months, and Wells Fargo charges no prepayment fees. If you want a low monthly payment, you can choose the 60-month option on your loan and not be charged any fees if you are able to pay off your loan early.
Furthermore, this best place to get a loan also has no origination fees on the personal loans that it offers, making the interest payments the only thing you’ll be paying for over the course of your loan. If you don’t already bank with Wells Fargo, however, you won’t be able to apply online and will have to find a brick-and-mortar branch in order to begin the application process.
Best Place to Get a Personal Loan: SoFi
Social Finance, or SoFi, is best known for the student loan refinancing options that it offers, but it also has a quality personal loan program. What makes SoFi one of the best places to get a personal loan is its low APR. If you set up an auto-pay option and have a decent credit score, you might be able to get a fixed interest rate as low as 5.95%
Furthermore, Social Finance also has no origination or prepayment fees. With this best place to get a loan, you can apply online and also find live customer support.
Furthermore, if you lose your job or find yourself in some other sort of financial nightmare, SoFi will work with you to temporarily suspend your payment plan while you find a new job or source of income.
Another reason that makes SoFi one of the best places to get a personal loan is its flexible loan amounts. You can apply for a loan up to $100,000, which is one of the highest loan amounts offered by online loan companies not connected with big name banks.
Best Place to Get a Personal Loan: Earnest
Earnest is one of the best places to get a personal loan, even though it isn’t very well known. It offers a fixed rate starting at only 5.95%, on loans up to $50,000.
Furthermore, this best place to get a loan also will work with people who don’t have the best credit score and will take into account other factors, such as employment history, savings and other assets, and your education.
Conclusion: The Best Place for Personal Loans Can Help You Weather Any Financial Storm
The best place to get a loan will most likely help you save hundreds of dollars as well as improve your financial situation quickly.
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