Consumer loans are financial products provided by banks and other financial institutions for their customers to finance personal expenditures. These loans have processes and the time span within which they can be processed. Some banks can process applications for loans between 2 to 7 working days while others may take longer depending on the kind of credit facility in question.
These days, however, there are lenders that receive and process applications for loans in a period of 24 hours and the funds disbursed within 48 hours. This is all thanks to advancements in technology globally and BankID in some European countries.
This fast expedition of loan applications and disbursement of funds has given birth to the financial product known as Same Day Loan. There are many variations of this product by different banks and lenders. Many people are interested in how forbrukslån på dagen uten kredittsjekk (consumer loan on the day without a credit check) works and how they can take advantage of it.
In this article, we will discuss the basics of consumer loans on the day or Same-Day Loans as are they officially called.
How Does Same Day Loan Work?
Same day loan is a short-term credit facility that is specifically designed to avail consumers of quick cash. In this case, the borrower applies for credit and gets approval and disbursement all within 24 hours. Below we give you a step-by-step description of how the process works: –
- Application – The first step in the process is to fill out an application to any lender of your choice. This lender may be online or offline but most often, same-day lenders are online lenders. The remarkable thing about this step is that it is fast and simple.
- Processing and Approval – The next step is the processing of the application. This starts if the applicant meets the eligibility requirements of the lender. Some checks are carried out on the borrower to access their ability to pay back. Once the lender is satisfied with the result of the assessment, they will send a loan offer to the applicant. This offer will outline the amount approved, the interest rate and fees, and the repayment terms.
- Acceptance – When the applicant receives this offer, they will have to sign the agreement document if they agree to the terms and conditions of the offer. You can either sign the agreement document in person or electronically.
- Disbursement of Funds – This is the final stage of the process which happens after you have signed the agreement for the loan. The amount approved is transferred to the borrower’s account within hours of approval or at most within 24 hours.
- Repayment – It should go without saying that every credit facility has to be repaid but sadly some borrowers ignore this fact. Bear in mind that you would have to pay your debt in full on the due date and this includes the interest and any other fees as stated in the loan agreement. This repayment can be in a lump sum or installments; it all depends on the lender. Click here for more information on this process.
Pros and Cons of Same-Day Loans
Looking at the way this type of credit facility works, we can deduce that it comes with some advantages and disadvantages. In this segment, we will examine these pros and cons: –
Pros
- Quick Access to Cash – Just as the name implies, this type of loan gives the borrower access to quick cash because of the speed of processing applications and disbursing the funds.
- Requires Minimum Documentation and Paperwork – Due to the fact that most if not all the process is digital/online, there is no need for so much paperwork or the submission of plenty documents. This makes the process faster than the traditional process which requires a lot of documentation and paperwork.
- Comes in Handy in Times of Financial Emergency – Same-day loans have been the saving grace of so many people in times of financial emergency. You can apply for the loan and get approval and the cash you need as fast as possible.
- Needs no Collateral – This type of credit advance does not require any collateral because it is an unsecured loan, and it comes in handy for borrowing small sums of money.
Cons
- Interest rate is usually higher than some other types of loans because it is an unsecured loan.
- Cannot be used to borrow large sums of money.
How To Apply for Same Day Loan
It is important that you know how to apply for this type of credit facility so that when the need arises, you will not be ignorant of how to go about the process. So below are tips on how to apply for same-day loan: –
Compare as Many Options as Possible
You need to check out as many offers as possible so that you will get the best one for you. You can even research lenders that offer this financial product before you even need to take out a loan. This will help you make a wise choice when/if the need for quick cash comes up. To save yourself some stress and time, you can work with loan agents who will advise you on how to go about getting offers from a wide variety of lenders without hurting your credit history.
Know the Eligibility Requirement of Different Lenders
Find out what different lenders require from borrowers before they approve them for credit of any kind. This will help you know whether you qualify and the amount that you qualify for. In the event that there are issues that will disqualify you, you can take care of them beforehand.
Submit an application.
After you have checked out as many offers as possible and then confirmed that you are eligible to apply, you can send your application to the lender of your choice. Make sure you know all the documents that they require (these documents are minimal most times) and attach them appropriately. This is the first step in the application process, and we have discussed all the steps in the segment about how these types of credit work.
Qualification for Same-Day Loan
No matter how minimal the requirements for this kind of credit facility are, the truth is that there are criteria for qualifying for it. Listed and explained below are the generally accepted criteria: –
- Applicant must be of legal age. We all know that the globally accepted legal age is 18 years. But there are some countries where banks will not approve a loan for anyone that is below 21 years. Some others even raise the bar as high as 23 to 25 years. Just ensure that you are up to the legal age requirement of the country in which you are applying.
- A steady source of income- This is one of the reasons why most lenders prefer people who are employed over self-employed folks.
- Contact details such as email address, home address with proof (utility bills receipts), and phone number.
- Proof of residency in the country in which you are applying. BankIDs are required in some countries.
- An operational savings account.
Conclusion
Same-day loans have helped a lot of people handle financial emergencies. We have discussed the basics of this financial product in this article. We believe that the tips shared here will help you make an informed decision when or if the need arises.
Bear in mind that it is better to have all the details that you need before time so that when you need to apply for this type of loan, you would not be making a decision in a rush.