Updated April 5, 2017
Have you ever experienced being in a financial dead end?
When you thought that your salary has been well budgeted until the next payday, a need pops out and you are suddenly desperate to get your hands on a loan. You apply for a personal loan, thinking that this is your only salvation, only to find out that you have been declined and one of the possible reason is your negative credit report.
Getting a loan is a serious responsibility a lot of Filipinos seem to take lightly. Before you get a loan, make sure that there is an actual need.
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Why do you need an online loan:
- Car Expenses
If you have a car, you must already know that you need to have it regularly checked and well maintained. It may cause a few hundreds to a couple of thousands of pesos to have an oil change or tire change, but you will be spending much more if you neglect these responsibilities. Imagine the cause of overhauling, buying a new battery, and grueling days of inconvenience in case your car decided to suddenly have a major breakdown. You would be lucky if it won’t stop in the middle of a main road as towing can even cause you more. Aside of malfunctions, do not forget to renew your vehicle’s registration with LTO. Late renewal will also be fined with a penalty.
- Loan Money to a Relative or Friend
Filipinos are emotional. Most of them can’t say “NO” when a family member, a relative or a friend knows at their door and plead for financial help. Though you may feel annoyed, you have to admit that you will feel guilty if you say no to your aging parents, younger siblings or BFF holding your “inaanak.” And if you have nothing yourself, they even ask you to borrow money in their stead since you seem to have more options than them. Imagine the frustration when they don’t pay on time, but your loan is already due. Ikaw ang naipit.
- Pay Utility Bills
Either you forgot you have a bill coming or you thought that your bills will be the same as ever but it turned out to have increased. You have already made a budget, but it turned insufficient. You have to settle your bill or else your electricity or water will be cut off. Not only will you be living with discomfort, your neighbors will also be gossiping about your poor situation. And if you have a baby at home, a loan will truly help in this situation.
- Buy Groceries
Most personal loans are actually spent on food. It is a necessity you can’t just pass up especially if you have small children. Filipinos usually borrow money from neighbors or get credits in sari-sari stores. Some regularly employed individuals also comes into this desperate point a few days before the next payday possibly due to lack of budgeting skills or weak resolution against shopping temptations.
- Time-sensitive Purchase
You might be eyeing an item for a few months now and then suddenly, on the time when you have just paid your bills and your sibling’s tuition fee, it went on sale for a limited time only. You can’t pass up the rare chance, so you got a quick cash loan to make the purchase.
- To Pay a Debt
There are times when you have to get a loan to settle existing loans to prevent them from accumulating high penalties. There is nothing wrong with debt consolidation, however, choose the right online lender wisely.
- To Avoid Borrowing money from Friends and Family
There are Pinoys who would rather get a loan from a private lender rather than swallowing their pride and ask for help from family and friends especially if the reason for needing cash is not an emergency.
- Sudden need to travel
There are unfortunate times when a close relative or an immediate family member suddenly passes away. Filipinos have a tradition of going home to their province to pay their last respects. If they have no savings, they opt to borrow from lenders, and usually online lenders have the fastest loan processing.
How to get your loan approved?
Though there are online loan lenders who still approve loans for those who have bad credit reports, there are still important things to do to avoid rejection.
- Duly filled up application form
Online loans have application forms in their websites where you have to fill in your personal and financial details. You should make sure that you have accurately answered every needed detail for your loan to push through. Some online lenders may have more than one page of application form, make sure that you are able to finish everything.
- Upload complete requirements
Since you are borrowing from an online lender, you are expected to upload your needed documents. Make sure you are applying to a legal lender as there are culprits posing as online lenders to get valuable financial information and use it for fraudulent activities. Most lenders will not process your application if you lack even a single required document.
- Personal Loan Calculator
Online moneylenders put up their loan calculators to help borrowers see how much they can realistically borrow based on their current financial status. Needless to say, do not borrow the amount you can’t pay at ease. Lenders will know how much you can borrow based on your income and past credits. You may get easily approved if you apply for a very high loan way pass your capability to pay.
- Stick to the adage: Honesty is the best policy
Never fabricate any detail. One way or another the online lenders will find out the truth. Their verifying personnel are highly trained to spot any inconsistencies with your application form and submitted documents. If you are found out to have lied about certain information, you will be automatically declined and added to a watch list.
- Give heads up to your personal references
Since the online lenders do not send a staff at your place to do an onsite investigation nor require you to go personally to their offices, you have to provide a couple of character references. You and your references will be asked a series of questions necessary to know if you are creditworthy. Tell them that a credit investigator will give them a call regarding your online loan. Some online lenders experience a hard time processing loans if the character references do not answer the calls.
- Be politely insistent
It is fine to be insistent, however be sure to be polite. Truth be told, you as a borrower has the responsibility to prove your credibility as responsible borrower. Being too insistent (almost at a rude manner) makes it seem that you are desperate for cash and too emotional to make a sound financial decision.
How to find the best online loan lenders?
Each lender has a different list of eligibility. Check it on the lender’s website to see of you are eligible. It will be a complete waste of time if you apply for a loan and it turned out that you are not even eligible.
Check the company profile by looking around its website. Does the website look professional and well-thought off or does it look poorly kept. Check if the website bares a Securities and Exchange Commission (SEC) registration number. If you have time, you can call SEC and verify the registration.
- Loanable amount
Use an online loan calculator to see the realistic amount of loan you can borrow and the repayments you have to pay according to your chosen term. Take time to reflect how much you really have to borrow and how much can you repay without sacrificing your basic needs. Responsible online lenders help their borrowers make an informed decision through their loan calculators.
- Loan tenure
Though online lenders usually offer short term loans, take time to check other loan tenure options that can best fit your needs and financial status. Remember that online lenders charge late payments fees and some lenders charge early repayment penalties, so choose the right one for you.
- Reviews in social media
Filipinos are now very active in various social media platforms. They enjoy their freedom of expression, and this is why it pays to visit the lender’s social media accounts. You can read the experiences of previous clients to have an idea on how they treat the borrowers and how professional they handle the applications.
- Other Fees
Online lenders charge other fees aside from interest rates, do not hesitate to ask them about these fees. Online lenders put their contact details on their websites, feel free to call them up for clarification.
Warning signs against loan sharks and scams
- Upfront processing fees
Legit online lenders process and approve your loans without asking for a processing fee. You are charge with the processing fee during disbursement, and usually it is either deducted from your principal loan or added to your repayments together with the interest. Never trust a lender who asks a fee before processing your loan.
- Too easy verification process
Online verifiers usually ask a lot of questions during verification process. The process which is too easy is too good to be true.
- No location information
Though online lenders do not require the borrowers to personally come down to their office, they do have a physical office and an address you can find in their website. You can use Google map to confirm their location.
- You are pressured to decide immediately
You must not be pressured to decide when getting a loan. Expect to receive options that are well explained.
- Shabby website
Legitimate online lenders work hard to keep their website user-friendly, informative and always updated.
Online lenders give loans to those with shaky credit history, however it takes a strict implementation of verfication and they may even charge higher interest rates. To make your credit report better, take small instant loans from registered licensed lenders such as Cash Mart, and pay diligently. These lenders report your payments to the Credit Information Corporation or to the Credit Management Association of the Philippines Inc., which helps you build up your credibility as a borrower. Once you have a better credit report, you can finally get crucial loans from banks such as housing and car loans.
Need instant online loan from a reputable online lending company? Get it from Cash Mart today. Check Cash Mart’s website now and experience the best online lending in the country.