Overview
Taking out an online loan, whether a payday loan or an installment loan, can come with certain risks. Therefore, it’s important to consider your readiness to take out the loan. In this article, we will explore seven signs that you are, in fact, ready.
Sign #1: You’re Facing Unexpected Expenses
If you’re faced with sudden expenses and your paycheque doesn’t go far enough, it may be time to take out an online loan. While a payday loan must typically be repaid within two paydays, installment loans offer longer repayment periods and, potentially, lower interest rates. When you experience a cash shortfall between paycheques and need to cover an expense such as car repairs, rent, groceries, or just about anything else, an installment loan can help tide you over.
Sign #2: You’ve Read and Understood the Terms and Conditions
It’s important to read the terms and conditions of the loan carefully so you don’t have any surprises. Friendly Lender will only connect you with online lenders who have clear and transparent terms and conditions. Transparency when it comes to the conditions and cost associated with the loan is a key indicator of a reputable and reliable online lender.
Sign #3: You’re Committed to Borrowing Responsibly
Responsible borrowing is multifaceted and involves all of the following aspects and possibly more: reviewing your budget, doing your research, not borrowing more than you need, and making your payments on time. If you need more time to make a payment, don’t hesitate to reach out to your lender. The lender may be willing to defer your payment due date.
Sign #4: You’ve Done Your Research
Prior to committing to a particular loan, you will want to have checked out the lender. Look at the online customer reviews, the lender’s website, and whether they have the license to operate in your province. If you detect any of the following red flags, you may wish to reconsider borrowing from that lender:
- No physical address or contact information
- Unclear loan terms
- No licensing
- Fake or poorly designed website
- No clear privacy policy
On the flipside, green flags include the following:
- Clear terms and conditions
- Compliance with local laws
- A clear and straightforward loan application process
- Access to customer support
- A secure website
If the lender exhibits the green flags, they are more likely to be an appropriate choice for your borrowing needs. Once you’ve done your research, you will be in the best position to make an informed borrowing decision.
Sign #5: You’ve Checked Out All Your Options
Have you looked at alternative borrowing options, prior to considering an online loan, whether it is a payday loan or an installment loan? Perhaps your friends or family can loan you money interest-free. It is never ideal to have to borrow funds online, so consider alternatives. If you’re unable to secure funds by alternative methods, it may be the right time to take out an online loan, as long as you’re committed to responsible borrowing practices.
Sign #6: You Can Afford the Monthly Payments
Look at your budget. Do you have room for the monthly payments? It’s important to stay on track with your monthly payments. Missed payments or late payments can result in additional charges and fees. Review your loan’s terms and conditions carefully to familiarize yourself with possible penalties for non-adherence to the repayment schedule. Speak with your lender if you need to defer a payment.
Sign #7: You Have a Stable Income
Almost all lenders require that you have a stable income. In the absence of a steady income, you will likely lack the capacity to repay your loan. While we don’t check your credit score or credit report during our simple and quick online application process, having a reliable income is an important criterion by which most borrowers will be evaluated by most lenders.
Conclusion
Ready to take out an online loan? Apply online via Friendly Lender. We don’t check your credit score or credit report during our simple and quick online application process. Even with a less-than-ideal credit history, you may qualify for an online loan.
If you need to improve your credit score, sign up for Credit Verify. It will allow you to monitor your credit score and automatically catch mistakes on your credit report. Get back your sense of control and take proactive steps to manage your credit standing in a positive manner.
