With so many lenders out there, both traditional banking institutions and non-bank lenders, it’s important to consider the pros and cons when choosing which is the right one for you.
Non-bank lenders are simply financial institutions that offer borrowers an alternative to getting a loan from a bank. The loan products are much the same and you’ll still be assessed before a loan is approved, however the loan limits, fees, support and interest rates may vary.
Alternative lenders may also offer people more choices when it comes to personal loans, car loans and even credit cards, and offer potential borrowers a chance they might otherwise not have had.
Banks usually have a lengthy loan application process and typically once loans are approved it can take anywhere from a few days to a few weeks before the money is released.
With the rise of technology, alternative lenders have streamlined and simplified the application and lending process. This means there are more ways for borrowers to secure the money they need, and they can sometimes receive the funds on the same day!
Non-bank lenders are known to take a different approach to banks that can be more open minded and considerate of your unique circumstances. At Rapid Loans, our dedication to personalised service means we assess and accommodate all scenarios and situations related to each application.
Alternative lenders are a great option if your credit rating is on the low side or if you’re self-employed and your income fluctuates throughout the year.
There are some basics of good service that are universal, whether you opt for a banking institution or non-bank lender.
If you value customer service, you should look at whether your account queries will be answered promptly and accurately.
While the banks have the presence of physical branches, alternative lenders often provide phone support and live chat as a replacement and with most loan services being offered online, there is no need to visit a physical branch.
Some borrowers question whether a non-bank lender is as secure as a traditional banking institution. Non-bank lenders must also comply with consumer credit rules and regulations such as the National Consumer Credit Protection Act and the Anti-Money Laundering and the Counter-Terrorism Financing Act.
All lenders, bank or not, are required to be transparent with fees and rates and that lending financial information is made readily available to you as the borrower.
While it’s tempting to choose the lender with the lowest interest rates, it’s important to assess your options using broader criteria. You have to make sure you choose the right lender who can offer your preferred level of support and loan products that work for your financial situation.
Sometimes it’s not just about the interest rate and features, it’s about finding a lender who offers you personalised service that reinforces you are a valued customer, like Rapid Loans.