Applying for a Loan by Phone
Dealing with an emergency can be a stressful time in your life, and it can be an even bigger challenge when you don’t have money saved up to take care of the associated expenses. If this sounds like something you’ve been through, you wouldn’t be the only one.
If you run into a situation like this, applying for a personal loan may be an option. But when you need to deal with an emergency expense right away, you may not have the time to go through the process of applying for a loan in person. After all, carving out time in your busy day to go to a physical storefront to wait in line can be easier said than done.
If you feel like you need a faster alternative, you may consider applying for loans by phone. If you decide to apply for a loan by calling a lender or service provider, or by using your phone to apply through their online portal, you’ll be able to avoid the parts of the in-person borrowing process that can slow you down.
What are Personal Loans by Phone and How do They Work?
As we alluded to before, applying for a loan by phone can refer to more than one thing. Deciding which of these two routes to go down will depend on what you’re more comfortable with, and what is better for your situation.
The first scenario would involve you applying for personal loans over the phone by calling in. This won’t necessarily follow the exact same steps for every lender or service provider, but in certain cases, this is what the process will look like:
1. Apply over the Phone
The first step will be to give a financial institution a call and talk to a loan officer to get the process started. They’ll get the necessary personal information they need to get your application started.
2. Review Rates and Terms
Once your application is completed, they’ll take some time to verify it and determine whether or not to approve you for a personal loan. If you’re approved, you can see the offered rates and terms and sign the necessary documentation.
3. Get Your Funds
Once you’ve signed on the dotted line, you’ll get your money after a certain period of time. The amount of time it takes will depend on the financial institution as well as your bank.
The second route you could take to apply for a loan by phone is to go to a financial institution’s website, or on their mobile app if they have one, and go through the online application process. Why would you opt for either of these ways of applying for a loan over the phone? We’ll take a look at this in the next section.
What are the Benefits of Applying for Loans by Phone?
Regardless of whether you’re planning on submitting an application for a loan over the phone by calling a lender or applying through their mobile app/website, the main benefit you’ll see from going either route is the level of convenience.
Whether you live far from a storefront lender, don’t have an accessible mode of transportation, or you have a very busy schedule that leaves you with little time to go looking for a personal loan, going through the borrowing process in person can be a challenge for a lot of people. When you apply for a loan over the phone, you can cut out a lot of the inconvenient aspects of borrowing money from a financial institution. You’ll be able to apply from wherever is most convenient for you, and in some cases, you can start the application process 24/7. Depending on the organization you’re applying with, you may even be able to get through your application in a few minutes.
Different Kinds of Loans by Phone
Before you consider applying for any personal loans over the phone, you should take the time to educate yourself on what products may be available to you. To help you get started, we’ve listed some of the more common types of personal loans out there.
1. Lines of Credit
A line of credit is a type of revolving credit that allows you to borrow money against your credit limit. Sound familiar? If it does, that’s probably because credit cards are also a form of revolving credit that function in a similar fashion.
With a line of credit, you’ll request a draw from your available credit. As long as your account is in good standing, you’ll receive your funds which you’ll then need to repay along with interest and/or fees. Once you do, you can borrow money again on a revolving basis. In terms of paying charges, you’ll only need to do so on the amount you’ve drawn, not the total amount of your line of credit limit.
2. Installment Loans
Installment loans function differently than the previous entry on this list. Instead of having a credit limit to draw from, you’ll apply for a lump sum of money, and if approved, you’ll get it all at once. You’ll then need to pay back the total amount that you’ve borrowed with interest and/or fees. This money will need to be paid back over the course of several months or years, and your payments will generally be the same amount each time and be due on the same day or days each month.
3. Title Loans
Unlike the previous two types of personal loans, title loans are a type of secured loan. While there are certain types of secured installment loans and lines of credit, getting either type of loan over the phone for an emergency will usually be in the form of an unsecured loan.
In order to qualify for a secured loan, you’ll need to give the financial institution some type of collateral to assure that they’ll receive a form of payment even if you aren’t able to make your regular payments. With an unsecured loan, no collateral will be required to qualify.
A common form of title loan is a car title loan. These loans require you to put up your car as collateral to qualify. In general, title loans tend to come with high interest rates and there’s also a fair bit of risk associated with them considering the fact that if you miss payments, you could lose your car. Don’t even consider applying for one unless you’re out of options and you know you’ll be able to afford the cost of the loan.
What are the Requirements for a Loan by Phone?
Before you decide to apply for a loan by phone, or any type of loan for that matter, you should look into what the qualification requirements are for the loan you’re about to apply for. While a lot of financial institutions will consider similar factors, there could still be some variance. In any case, there’ll likely be a few factors that may come into play, like:
- Your credit history
- Your income
- Your employment status
- Your state of residence
Can I Apply for a Loan Over the Phone with Bad Credit?
Bad credit isn’t always the easiest thing to deal with, particularly if you’re on the hunt for a personal loan. Your credit score is one of the main factors that a financial institution may look at to get an idea of what type of borrower you’ve generally been over time. But that doesn’t mean that you have no options if you find yourself with an unsavoury credit history. There are certain financial institutions out there that offer online loans by phone to those with bad credit. Instead of placing a large chunk of their focus on your credit score, they’ll instead focus more on some of the other qualifications we mentioned in the previous section.
You May be Able to Get a Loan Over the Phone in an Emergency
We understand that emergency expenses can feel like a dark cloud constantly circling overhead. A well-stocked emergency fund is important to have, but these take time to build up. And in an emergency situation, time is of the essence. If you find yourself in need of funds right away, a loan by phone may be able to help. Scour the internet for loans offered over the phone in your part of the country, and compare and contrast your potential options. You’ll want to make sure you’re applying for something that’s suited to your situation, so put the time in to figure what that is.