Personal loans have become easy to borrow small or large amounts of money for many reasons. For one, you can use them to pay for any situation, such as a wedding, funeral, trip, unexpected medical bill, and home repair.

Another reason is that lenders usually send the loan funds straight to your bank account so you can start spending it right away. Some lenders can disburse the money within the day once approved.

If you’re in a pinch, here are the most common ways to get personal loans.

Online Lenders

Online lending companies are the go-to financing options for people who need cash quickly. Take CreditNinja Instant cash as an example. When reviewing a borrower’s application, these companies use algorithms, which makes the process easier and faster.

As a borrower, all you have to do is fill out the online forms that an online lender gives you. Lenders also ask you to upload your most recent pay stubs and bank statements to prove your income.

However, they don’t just examine a borrower’s income and credit. They’re also willing to judge a borrower’s creditworthiness based on your education level and length of employment. 

Overall, online lenders have less stringent qualification requirements. Despite that, they usually have faster approval and funding speeds. Their application processes are also more streamlined, making borrowing even faster. Plus, some lenders may offer a fee-free structure that can lower the overall borrowing costs.

The only downside of online loans is that the rates are much higher than those offered by credit unions or banks. Still, it’s a plausible financing option, especially if you need money as soon as possible yet have poor or no credit. 

Banks

If you need funds for big expenses like a car purchase or a high-priced wedding, it’s best to get a personal loan from a bank, either online or physically. Specifically, banks can lend you $50,000 at max on average, but others may also offer $100,000. 

Some banks have already put their services online, just like online lenders. Still, other banks look over loans by hand. The worst thing that can happen is that you have to wait two or more weeks to find out if you can get a personal bank loan.

More importantly, banks, whether they’re online or physical, always try to avoid taking risks. Borrowers might have difficulty getting a loan if they don’t have good credit. The good news is banks typically effectively reward and incentivize customers through rewards or loyalty programs. Hence, once you’re their customer, you may enjoy many benefits, including loan discounts and lower interest rates. 

Credit Unions

Credit unions are institutions owned and controlled by their members, who use their services. Anyone, regardless of their credit, can take out loans from them. Plus, they have lower fees and rates. It’s safe to say that credit union personal loans are among the easiest.

However, you’re not eligible to take out personal loans from credit unions if you’re not one of their members. Typically, the process of joining isn’t complicated. Most of the time, all you need to do is open a checking or savings account and have a few dollars in it. 

Another problem is that credit unions are only for people in specific jobs, who work for companies that work together, or who live in certain areas. Because of this, not everyone can be a member.

Peer-to-Peer (P2P) 

One way to cut out financial institutions as middlemen is to use peer-to-peer (P2P) lenders. Peer-to-peer lending, which is also called “crowd” or “social” lending, lets investors and borrowers talk to each other directly.

You can get a loan from a peer-to-peer lender to pay for big expenses, like a home renovation or car purchase, just like banks do. However, you must have good credit. Disbursal of funds may also take some time since borrowing from a P2P lender should be backed by another person. 

P2P lenders are similar to online lenders in a lot of ways. Its loan processing is fast because it has fewer steps and requirements. It’s also typically operated online, so it’s very convenient for borrowers. 

The only difference is that an online lender is a company with its online lending platform, while a P2P lender is an individual who offers a loan on a P2P lending site. Both the borrower and the P2P lender have to pay fees to use a P2P lending site. If something goes wrong, a P2P lending site may charge both the borrower and the P2P lender late fees, loan origination fees, and bounced-payment fees.

Final Thoughts

The first step in getting a loan is to nail down your priorities. Banks are the most reliable place to get a loan for a large amount, while credit unions have the best rates. If you need money quickly, you might want to look for a lender online. But if you don’t want to deal with applications, a peer-to-peer lender can be an easy way.