The Ultimate Guide To Private Loans
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If you’re considering a private loan, you probably have questions about how they work and how to go about getting the best deal possible. That’s why we’ve written a very handy ultimate guide with everything you need to know about private loans! Having all the information you need in one place will save you a lot of time researching. Read on below to find out all the answers to your queries.
What is a private loan?
A private loan is a form of funding that comes from private lenders, instead of traditional lenders such as banks. Private lending can often offer better options in terms of easier approval, quicker processing times and less need for a good credit score. Private lending may be a good option if you are finding the traditional forms of lending criteria too hard to meet. Unlike banks, private lenders don’t usually have traditional qualifying systems, meaning that getting access to a loan is much easier.
Benefits of private loans
Private loans have many benefits going for them that you won’t find in a traditional loan. Some of those benefits are:
- Faster settlement – If you happen to require a loan quickly, the approval process for private lending is faster and can usually happen within a few days. Traditional loans through a bank may take weeks or even months.
- Specialised loans – Private lenders are often able to cater to those after a wide range of loans that you won’t find through a bank. This may be ideal for those seeking short term finance, or those in need of funding quickly.
- Credit history – When applying for a private loan, your private lender may not need you to have perfect credit. Many private lenders also specialise in lending to those with bad credit.
- Fewer requirements – Private lenders often require fewer documents than banks do. Banks often need you to have a good repayment history, no arrears, and a stellar credit history before they will consider approving you.
- Flexible payment terms – Private lenders may be able to offer you a more flexible rate compared to a bank, as well as flexible loan terms.
How easy is it to get approved for a private loan?
Applying and getting approved for a private loan is usually quite simple. One of the benefits of a private loan is that generally, there are faster approval times. This is usually because there is a lot less paperwork compared to a traditional loan, which may take weeks to be approved.
You may find that applying for a private loan is easier than applying for a loan with a traditional lender. Many private lenders don’t need to be supplied with as many documents as you normally would when applying for a traditional loan.
How long does it take to get a private loan?
In most cases, private lenders can have you approved in a matter of hours or days, unlike traditional lenders. This time frame can depend on what you need to supply your lender with, and how long their checking and approval process usually takes. When you apply through your lender, they will usually be able to give you an estimate of how long their process will take.
What will I need to supply?
When you’re applying for a private loan, you may be asked to provide documents such as:
- Personal information – Most lenders will need you to provide documentation that proves your identity, such as a passport, driver’s licence or birth certificate.
- Employment information – Generally, this needs to be evidence of your current salary or wage, plus any extra income you may be receiving. Your lender may also need to see other proof of income such as your most recent payslips or tax returns.
- Financial information – Your lender may ask for proof of your financial situation. This may include whether you own your home or rent, and proof of your assets and expenses. Your lender may also ask you to provide proof of any savings with other banks if you have any.
- Any other debts in your name- Your lender may also want to know about any other debts you have. This may mean providing any other credit card or loan statements that you have.
Before you begin your application, it is always a good idea to double-check with your lender to find out exactly what you need to apply.
Is good credit necessary?
If you do have a less than perfect credit history, you have been rejected by the banks. However, you may find that a private lender will still do business with you. One of the main benefits of applying for a private loan is that your credit rating may not matter as much to a private lender as it would to a bank. In most cases, lending criteria with private lenders are less rigid. So, if your credit rating isn’t the best, a private lender might be able to give you a better loan than a bank traditionally could.
Why should I use a broker?
A good broker can advise you on the type of private loan that you need, as well as explain the key features of each loan to you so that you can make an informed choice. A broker can also negotiate with your lender about the details of your loan. If you were to choose to not use a broker, you would find that exploring all of the loan options available to you and vetting any worthwhile options would take up most of your free time. Instead, a broker can handle all of the research for you. A good broker will be able to negotiate loan terms that suit you, as well as make sure that your loan is settled properly.
How Can Tiger Finance help?
We can help by getting you approved for a loan in four easy steps. We have helped countless Australians with both good and bad credit ratings get approved for funding. If you are one of the many Australians finding getting a loan difficult, Tiger Finance can make the process simple and pain-free. Call us today to speak to one of our loan specialists for your free initial consultation.
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