Personal Loans From Online Lenders Can Be A Secure Move

There are plenty of reasons to consider getting a personal loan. Some common ones include getting a personal loan for credit card debt, getting a personal loan for home improvements, and getting a personal loan for a vacation or other special event. These are not the only reasons, of course, as personal loans can be used for basically anything.

Making the decision to get a personal loan is big enough. Such a decision can affect your life in many ways, both positively and negatively. If you are going to go through with the decision, you want to be sure that you are making a wise decision about where you get the loan. Once upon a time, choices were limited as there were only so many financial institutions that loaned money. Today, however, there are tons of places in each city and online. With so many options, how do you choose the right lender?

The answer is simple. You do your research. When it comes to borrowing money, what worked for your mom or your best friend may not work for you. You need to find a lender that suits your financial situation and your needs, and that will be different for everyone. Some people will find that a lender is their best option while others might find an online organization dedicated to the loan is best for them.

We are going to kick start your research here with this guide on personal loans from lenders, their pros and cons, and the basic types of personal loans you can get from lenders. Let’s jump right in.

Personal loans from lenders work similarly to loans from other places. You put in the application, provide the necessary documentation, and probably have an in-person interview with the loan officer. Afterward, the loan officer will consider your personal information and decide whether or not you fit the lender’s criteria. They will then pass that decision onto you.

Some people steer clear of getting loans from lender. This is usually because they have heard how difficult it can be to get approved. Other people only think of traditional online lender when they consider getting a loan because that is the way their family or friends did it. Either way, there are both advantages and disadvantages to getting personal loans from lender.

Advantages of Personal Loans From Online Lenders


One great thing about personal loans from lender is that the lender tend to have a reputation to stand on. Chances are that someone you know has had dealings with the lender in your area. Your grandparents probably lending with some of them, your parents with others, and friends with others. This makes them feel more trustworthy to you.

Additionally, most of them have a history you can research. The same cannot always be said about other lending institutions, so borrowers often feel more secure getting personal loans from lenders. This does not necessarily make them better- just a more comfortable option.

Relationships with customer of Opportunity loans – Personal Loans

Sometimes, though not always, the relationship you have with your Lender might give you a boost up. For instance, some lenders, especially Opportunity Loans, Market Loans personal, might approve their customers for loans even if the customer does not quite meet the requirements. Or the customer might receive special rates because of their loyalty. Again, this is not always the case, but some online lenders like Opportunity loans and market loans personal do make every effort to help their members.


Online lenders usually have lower interest rates for personal loans than many other financial institutions. This is actually one of the best reasons to go to a online lenders for financial needs. Personal loans from lenders can provide some of the best terms and rates.

Disadvantages of Personal Loans From Banks

Difficult to Obtain

Most banks have really stringent requirements when it comes to approving loans, especially in the credit score department. Banks are very picky about who they loan money to. If you do not check off all the boxes on their list, you will likely not be approved.

As I stated previously, some banks are a bit more flexible when it comes to helping their members. This is more so with credit unions and smaller banks- ones that serve specific areas as opposed to being part of a chain. Most large, franchised banks are not flexible in their requirements. If you do not meet their requirements, you are simply out of luck.

May Require Collateral

Some banks do not provide unsecured loans at all. Others provide them, but only to those with stellar credit. For everyone else, you must provide some form of collateral. We will get a little deeper into secured and unsecured personal loans from banks in a minute. The point, though, is if you do not have something that can be used as collateral or really excellent credit, a bank may not be the best avenue for you.

Fewer Options

Banks either have their own financial products or work with one lender, limiting the options available to you. If you do not fit the requirements for that one lender, you might as well walk away.

Most other lending institutions work with several lenders, offering their borrowers a wide variety of products. With these institutions, if you do not fit the requirements for one product, you still have a shot. They can usually find a product to fit your situation instead of trying to fit your situation into a product.

Longer Wait

Personal loans from banks can take a much longer timeline than other institutions. Some online lenders say that they can get you approved and get the money into your account in a day or less. Banks tend to take days, sometimes weeks, to make loan decisions and process the payout. If you need the money quickly, personal loans from banks is not the best choice.


Fees are another downside of personal loans from banks. The type of fees they charge vary according to the bank, but do not be surprised to see origination fees or even prepayment fees. While some other institutions may charge these same fees, they are much more common with banks.

On the positive, these fees, except for late fees or prepayment fees, are often calculated into the loan, so you are paying for them as you make your loan payments instead of having to pay them upfront. However, this causes another issue. Let’s say you need $1,000 and the bank approves you for that. They also charge you a $100 origination fee, which is calculated into the loan. Though you were approved for the full amount, you will actually only receive $900.

This might not be a problem for everyone, but if you need the full $1,000 for something, it could affect you. If you choose to get a loan from a bank, or any other lender, be sure you understand what fees are added at what point. That way, you can ask for enough money to cover the fee and what you originally needed the money for.

Secured Personal Loans From Online Lender

Secured loans are those that are attached to some form of collateral. This collateral might be:

  • A home
  • A piece of property
  • A vehicle
  • A savings or investment account
  • Electronics
  • Jewelry

Collateral can be anything that is valuable that you own. It is up to each individual lender what types of collateral they accept.

Advantages of Secured Loans

Lower Interest

Since your loan is attached to collateral, the lender is assuming less risk. If you default on the loan, he or she can take possession of that collateral and recoup some of the losses. As there is less risk, the interest rates are usually lower than those on an unsecured loan.

Higher Approval Odds

Providing collateral makes it much more likely for someone to get a personal loan for bad credit. Even if that person has lower credit, the lender is still assuming less risk, so they are more likely to consider lower credit scores for your personal loan.

Higher Loan Amounts

Secured loans also usually come in larger amounts than unsecured loans. While this is an advantage in most cases, it can also be a disadvantage. Higher loan amounts come with higher fees and more overall interest. It is important to factor that into your decision.

Disadvantages of Secured Loans

Risky for the Borrower

No one plans to default on a loan. When a borrower takes out money, they do so with the belief that they will be able to pay it back. It seems safe to put up collateral because they plan to get it back.

What happens when life happens, though? Sure, you had every intention of repaying that loan, but that was before you got laid off, before your kids got sick, before someone without insurance rammed into your vehicle, or before the pipes burst in your bathroom.

The truth is that we never know what is going to happen, which is why using collateral for a loan is so risky for the borrower. Let’s say you used your only car as collateral, and due to no fault of your own, you find that you cannot make your loan payments. What will you do if the lender comes to take possession of that car? How will you get to work or get your kids to school?

I’m not saying that you should steer clear of secured loans completely as that may not be an option. I am trying to get you to think it through a bit more and do so with care. Have a backup plan just in case the worst happens.

Unsecured Personal Loans From Banks

This category of loans is another type of personal loan from banks. Unsecured means that there is no collateral attached to the loan. You are borrowing on your agreement to repay. There are pros and cons to unsecured loans, too.

Advantages of Unsecured Loans

  • Less risky. As there is no collateral connected to the loan, an unsecured loan is less risky for the borrower. Yes, there are still issues if you default on the loan. However, you are not signing over the rights to your home or car.
  • Faster approval times. Secured loans often take longer to be approved because the collateral has to be appraised. There is no appraisal process with an unsecured loan, though, so they can be approved much faster.

Disadvantages of Unsecured Loans

  • Lower loan amounts. As the lender has no guarantees in the form of collateral, unsecured loans tend to come in lower amounts. This is one way that the lender minimizes their risk- if you do default on the loan, it is a smaller amount.
  • Higher interest. Since an unsecured loan is so much riskier for the lender, they come with higher interest rates. This means you will either be paying more each month or you will be paying for a longer period of time. Either way, unsecured loans cost the borrower more.
  • Lower approval odds. Unsecured loans are based off of your credit-worthiness. This makes it very difficult for many people to get approved for them.

Tips for Getting Personal Loans from online lenders

Consider the loan carefully

Here’s the thing: No matter why you need the loan, it is still debt. If you are struggling to pay your current bills, adding on a new one is not a wise move. I understand that sometimes you have to make choices that are not the best. But be sure you think it through carefully. With a little time, you may be able to find another solution.

Check your credit before applying

You do not want to be surprised when you get there. Imagine thinking that you have a credit score over a 680 but the bank telling you that you are about 30 points off. When you take a look later, you realize that a collections account was added to your credit report in the last couple of days that you were not even aware of. It is always best to check your score right before applying.

Research the specific institution’s requirements

Check credit score requirements for your personal loan. If they require a 720 credit score but you only have a 650, you can save yourself time by moving onto the next option.

Apply for all personal loans within two weeks

Every time you apply for credit, your credit score is affected. However, if you apply for credit in the same industry within a two week period, you should only get that hit once instead of for every application.

Be prepared

Getting approved and getting the money is already going to take some time. Don’t add to it by not being prepared. Take all personal identification and financial documents with you to the interview. Otherwise, your application may be put on hold until you return with it. The more prepared you are, the quicker you should get results.

Be smart about collateral

If you have to put up collateral to get approved, be smart about it. Try to use something that would hurt the least if you were to lose it. For instance, let’s say you have two cars: One for you to get to work that is too small for your whole family and one for the whole family to get around. While losing either would be terrible, it would be worse to lose the vehicle that can get everyone where they need to go.


Anytime you take out debt or add on a new bill, you need to revisit your budget– assuming you already have one. If you do not, creating one should be a priority. As soon as you add this new expense to your life, you need to add it to your budget. Do not wait until the week the loan is due to figure out how to pay it. Decide immediately how exactly you will cover it. You might need to cut something else out of the budget for a while, cut back on some things, or pick up a second job. Whatever you need to do, make the plans now.


For many people, getting a loan from a online lender like opportunity loans personal loan is a wise move. For others, it may not be. Whether it is the right move for you can only be decided after you consider your financial situation and how personal loans from online lender can affect your life. Do not rush the decision if you can help it. Take the time to consider it fully before making a move.

Remember, you can always try with an bank if the online lenders are not the best option for you. We partnered up with Fiona to be able to connect you with the best lenders for your situation.

Brandy Woodfolk is an educator, home business owner, project manager, and lifelong learner. After a less than stellar financial upbringing, Brandy dedicated her schooling and independent studies to financial literacy. She quickly became the go-to among family, friends, and acquaintances for everything finance. Her inner circle loves to joke that she is an expert at “budgeting to the penny”. Brandy dedicates a large portion of her time to teaching parents how to succeed financially without sacrificing time with their little ones. She also teaches classes to homeschooled teenagers about finances and other life skills they need to succeed as adults.

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