You might go to the dentist with a sore mouth and discover, to your dismay, that you need several thousand dollars’ worth of work to fix it. Or else the transmission goes bad on your aging car and needs to be replaced. Or maybe your grandma had a bad day at the casino and is now reneging on her promise to pay your college tuition bill.
You get the idea. There are plenty of scenarios in which you might need money in a hurry. A personal loan — basically, an installment loan from a bank or another financial institution, in most instances without the need to put up any collateral to secure it — is one way to get your cash. These days, with the advent of online lenders who use financial technology, also known as fintech, to automate the loan approval process, you may be able to get that money deposited in your bank account more quickly than ever.
“Many online personal loan services are able to provide you with a loan within just one business day,” explains to Joseph Schwartz, head of content at loan-comparison website Fundinghero.com, in an email interview. “The funds will be deposited directly into your account and you will be able to use them however you wish.”
In addition to taking out a personal loan, there are other ways to come up with quick cash in a pinch, though some of them have downsides as well. And there are some options that you definitely should avoid. Here’s more about the various options.
1. Apply to an Online Lender for a Personal Loan
“Online lending platforms also have the added advantage of providing several loan options with varying terms and conditions, allowing the borrower to choose the most comfortable option,” Schwartz says. “Sure, they can do the same thing by going bank to bank, but an online loan service will save them both time and money.”
Todd Nelson, senior vice president of online lender LightStream, a division of SunTrust Bank, concurs. “Fintech has made getting a loan easier,” he says by email. “There’s no need to go to a bank branch, fill out paperwork, then wait to get an answer and finally receive your funds. You can get a loan at your convenience via a computer, tablet or smart device.”
In LightStream’s loan process, a potential borrower fills out a short form. Then, using LightStream’s proprietary technology and a series of algorithms, a decision is made on the loan, and the borrower is quickly notified. After the initial approval, the borrower has to put an electronic signature on the documents, provide bank account information, and select a monthly payment date. At that point, the funds are deposited directly into the person’s bank account — “often as soon as the same day of application,” according to Nelson. There aren’t any limits placed on what the money can be used for, he says.