When you’re down on your luck and need some extra cash to cover an emergency, you don’t have to make a trip to your nearest bank for a personal loan. 

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Nowadays, you have a faster and more convenient way to borrow right at your fingertips. You just need a computer or smartphone and a secure connection to the Internet.

Like groceries, cruelty-free cosmetics, and hardware supplies, personal loans join the many goods and services available over the web. All you have to do is type loans into a search engine, and you’ll get millions of results delivered right to your screen. 

This digital shift from the traditional brick-and-mortar banks has transformed the borrowing experience. Here are all the changes you can expect from online direct lenders. 

Greater Number of Options
Try out that search mentioned above by typing something like this into the search bar: online loans near me. After a few nanoseconds, you’ll have pages of options to go through.

Compare this to traditional (or analog) forms of borrowing. Traditional in-person financial institutions in your town could never match these options. 

While at first, variety of this scale may seem overwhelming, it actually works in your favor. You get to choose from an enormous pool of potential loans and cherry-pick the best available one in your area. 
After a bit of digging, you’ll notice that the term “personal loan” is an umbrella term that includes several different options. Here are some of them below: 

Cash advances
Payday advance loans
Installment loans
Lines of Credit

Each product comes with different rates, terms, and conditions, so it’s a good idea to compare these options carefully before you sign across the dotted line. 

Data-Driven Decisions
In traditional lending spaces, your approval usually hinges on having prime credit. Anyone who doesn’t cut the mustard gets denied. But that’s not the case with online loans. With more options available from the get-go, you can find instalment loans for those with poor credit that may have flexible eligibility requirements. 

Some online direct lenders expand the qualifying data to include other information in addition to your credit score. They may also consider your income, pay schedule, and employment history to make their decisions. Some online direct lenders may even consider alternative credit data, including utility bills and rent payments. 

Broader qualifying data provides a more holistic look at your finances right now than a credit score on its own. This gives people who have been excluded from prime loans a viable alternative. 

According to the latest numbers, roughly 20 percent of Americans have subprime credit and another 11 percent have thin credit. Installment loans for bad credit could wind up helping a huge fraction of the country.

Convenient and Accelerated Applications 
Online direct lenders are known for speedy applications available through their website 24 hours a day, seven days a week. You can apply in the middle of the night or on a holiday without hitting a wall.

An online application form usually takes only a few minutes to finish, provided you have all your basic information at the ready. 

Compare this to an in-person loan. Brick-and-mortar financial institutions are bound by prohibitive bank hours. Open from just 9–5, these banks make it difficult for anyone who works during these hours.  

Once you get there, you could wind up staying for a while. Some in-person applications take hours to complete after you add in the prerequisite meeting with a financial advisor. Then you could expect to wait another couple of weeks or even months to hear if you’re approved. 

Because online direct lenders collect and review this data electronically, they can use powerful algorithms to analyze your application info rapidly. They may arrive at an underwriting decision within seconds, letting you know if you qualify without delay.

Expediting this part of the borrowing experience has a ripple effect on the rest of your loan. If approved, you’ll be able to receive your funds that much faster since you won’t have to wait around for weeks to hear back about approval.

Convenient Funding and Repayment
Typically, online direct lenders will set up convenient disbursement and repayment options. All you have to do is provide a checking account during your initial application, and they’ll wire your money to this account directly. You can also set it up so that your lender withdraws your payments from this same account, or you can choose another account that suits your preferences. 

An automatic deposit and withdrawal system comes as a huge benefit to busy people. You won’t have to arrange a time to pick up a check or cash from a faraway location, nor will you have to take time out of your day to deliver your payments. 
This is especially helpful if you choose an installment loan. As online loans with monthly payments, you would have to make several deliveries inperson. Letting your lender take their payments electronically cuts out all that hard work.

Bottom Line
In-person personal loans will never disappear entirely, but evidence shows more people are tapping into online alternatives than ever before. According to a Fiserv survey, 65 percent of people applying for personal loans — that’s nearly two-thirds of all borrowers — did so online. 

Online personal loans are drawing record numbers for a reason. Whether it’s due to their ease, variety,convenience, speed, or accessibility, you’ll have to be the judge.