Our lives are becoming more and more digital. Many people are upset by this and wish that the “good old days” would return. However, digital transformation also brings us many advantages – especially as the use of the Internet becomes more common. Today, almost everything can be managed and applied for online. Here we illustrate this key advantage of digitalization using the example of “applying for a loan online”.
Online credit makes life easier!
An online loan is a regular consumer loan obtained over the Internet. The lender is usually a direct bank that has chosen the Internet as its main sales channel and can offer attractive terms here. In order to better explain an online loan, it is easier to highlight the differences in a regular loan from a branch bank, which automatically shows some differences between direct banks and branch banks.
Online loans are often available on better terms
If you look around a bit online, you'll quickly notice that you can usually get a loan online on slightly cheaper terms than the corresponding financing offer In the bank branch. This is mainly because direct banks that offer online loans have a leaner structure and do not have expensive branch networks. Clients also benefit in part from the resulting cost advantages, which of course also explains the growing popularity of this financing.
Another important difference between an online loan and a loan from a branch bank lies in the application procedure, because while you can apply for the loan online easily from your computer, to get a loan from a branch bank, you have to plan several conversations until the issue is resolved. . The required funding is obtained and (hopefully!) approved. However, applying for a loan online only takes a few minutes. This is followed by immediate confirmation or direct rejection. The required documents and signed loan agreement must then be sent and identification must be carried out using video or post-identification procedures. In the latter case, the applicant proves his identity with his identity card and a coupon at the post office. On the other hand, the video recognition process runs directly on the computer. Once this happens, you usually have to wait for confirmation and transfer of the loan amount.
Online loans are easier to compare
Since there are many loan comparisons on the Internet, it is very easy to quickly glance at the different offers in the online credit area, whereas with offers from branch banks, you have to manually search for all the conditions. Better comparability ultimately means that more interest costs can be saved, as the cheapest offer can be found quickly and easily thanks to digitalisation.
The only real drawback that online loans have compared to regular loans from branch banks is the lack of personal advice. However, since the range of good information sites on the Internet is now very large and any doubts can be clarified directly using telephone hotlines, this is no longer so important.
What types of credit can you apply for online?
Thanks to digital transformation, almost every loan can now be applied for online. However, some forms of credit are particularly suitable for an online degree. We offer you:
The term instant loan has only appeared with the distribution of online loans and indicates that it is often much easier and, above all, faster to apply for a loan online. In particular, it is the immediate commitment made by many credit institutions based on the data provided that constitutes the instant loan. The most important features of the instant loan will be discussed below to provide the interested reader with a convenient overview.
Anyone who takes out an instant loan from a direct online bank usually gets instant approval within a few seconds, based on the data entered in the short online application. If this instant approval is positive, in many banks you simply have to fill out the loan application, print it and attach the necessary documents. After mailing it, you will then receive a corresponding loan agreement that shows the desired loan amount and potential interest rate. Unlike a loan from a bank, with an instant loan from the internet, you already know whether you will get a loan or not when the loan is approved instantly. This means that you have a certain level of planning security and can focus on the issue to be financed.
Since online instant loans are mainly given by direct banks, you can often find much cheaper offers here than in regular branch banks. This is mainly because direct banks have a leaner cost structure and can therefore offer more favorable conditions. However, you can often find not only cheaper interest rates here, but there are also much more options to make your instant loan very flexible. These include, among others, the option of free special repayment or free installment suspension, which are available once a year. Of course, these features can also be found from time to time in offers from bank branches, but with an instant loan, you often get a combination of these flexible terms at low interest rates.
Instant loans often offer very fast payments
There are some direct banks that specialize in paying off your instant loan especially quickly. For example, you can find online banks that process loan applications even on weekends, thus significantly shortening the time from application to payment. The bottom line is that instant loans from the Internet are becoming an increasingly popular form of loans that more and more customers are taking advantage of.
A small loan refers to a loan whose loan amount usually does not exceed 5,000 euros. With such a small loan, which usually does not have any allocated provisions, a wide range of expenses can be made. Good examples are car repairs, taking a vacation, or doing a simple renovation to your home. Since microloan is also the most widely used form of loan, the most important information on this topic has now been compiled and presented clearly.
One advantage over microloans over other forms of loans is that approval is largely unbureaucratic and simple, as no other security is usually required except regular income. Only the Schufa examination is still performed, which should not lead to any negative results. In addition, some banks use a simplified credit check for particularly small loan amounts, so you can repay the small loan to your checking account more quickly.
Dealership financing is often small loans
If you intend to purchase a specific electronic device or need a spare part for your own car, you can often do so through financing through the relevant dealer. This type of financing is also known as a microloan, since the loan amounts are often not particularly large and the granting is also relatively uncomplicated. This option is always especially interesting when the financing interest rate is particularly low due to special promotions.
Small loan as an alternative to overdraft facilities
Since a microloan is often offered at very low interest rates and is almost always cheaper than an overdraft, it can be considered a useful alternative to an overdraft. If you also want to replace your overdraft facility, you can easily do so with a small loan, as long as you have the income to lend.
Since a microloan only involves a small loan amount, the closing fee must be adjusted to that loan amount. However, many banks fail to do this and charge fees similar to those charged on loans with larger loan amounts. In such a case, excessive fees may arise, which can be easily avoided by looking for an online loan provider that does not charge any closing fees.
Buy today, pay tomorrow – this slogan attracts many retailers. Mail order companies and electronics companies in particular advertise installment loans as a form of financing for the purchase of their goods. With the help of an installment loan, the customer can purchase the relevant goods immediately and pay for them in fixed monthly installments. An installment loan is now a popular way to quickly turn financial dreams into reality or to pay for necessary things such as heating renovation. Installment loans are a popular form of installment payment for various consumer goods, especially in the mail order sector. Thanks to the advancement of digitalization, all of this can usually be done online.
To grant an installment loan, the sufficient creditworthiness of the individual is the crucial basis. This will be verified by the lender before granting the loan. For small loan amounts, this check is usually very spotty. Mail order companies in particular accept payment in installments without conducting a detailed credit check of the customer.
In order to be able to avail a higher installment loan, various proofs are usually required from the person seeking the loan. To check your creditworthiness, the lender generally uses a Schufa (“General Credit Protection Protection Association”) inquiry. If the result of your Schufa inquiry is positive, it means that the first hurdle on the way to obtaining an installment loan has been overcome. Proof of regular income from the employment relationship of non-self-employed persons is also an important criterion for granting an installment loan. This can be proven either by submitting bank statements or an employment contract from the loan applicant.
Cheers to digitization! Thanks to this, we can now easily apply for different forms of credit online, for example. The long and arduous journey through the bank branch is no longer necessary, and many borrowers now have the required amount in their hands after only a few hours, instead of having to wait days or even weeks to get it as was the case previously. This is how digital progress really makes sense!
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