Comparing to everything in today’s materialistic world, money is believed to be the most important. And that’s always a big problem to get it quickly, without hundreds of questions, queues, and explanations. Personal loan is the best way to solve the problem. Wherever money is needed for a vocation or to buy a car, or even to buy a prom dress this kind of lending will be at hand 24/7.
Though there is an aspect a borrower needs to remember. There are two types of personal loans: secured and unsecured loans. The difference lies in the collateral existence. So, to take a secured personal loan the borrower should put up something like a house or a car, and there is no property required to take an unsecured loan.
Requirements for getting a personal loan
Though there are no special requirements to make a demand for personal loan approval, there are some necessary conditions for getting it.
1. Any person who wants to get a quick personal loan should be older than 18 years old.
2. The borrower should be a Filipino citizen, thus a valid ID is absolutely obligatory.
These two requirements mentioned above are common terms. Some following conditions may vary depending on the service.
- Employment certificate (more widespread for secured personal loans);
- Collateral (the obligatory requirement for secured loans, and won’t be useful in “no collateral loans”);
- The phone number of both borrower’s workplace and boss (rarely asked by the online personal loans platforms)
- Valid SSS (Social Security System) – sometimes asked together with ID, though not that obligatory.
Take into account, that except those documents that borrower should apply, he/she should have information about the loan tenure, as well as interest rates. Do not provide your personal data to scammers! Use only reliable personal loan providers! Check up the best platforms above!
A bit different kind of “requirement” is the reason for applying for online personal loan. The borrower should take it seriously because monthly interest rate could be higher than 20%. The most popular reasons to take a personal loan are:
- Loan for education;
- Repairmen or lack of money to buy a real estate;
- Surgery/treatment (the most widespread as the personal loan approves applications promptly);
- Travel or unexpected ride;
- Car purchase;
- Buying of the equipment for a business;
- Startup loan (as this kind of applications a less successful in the banks).
How to Apply for a personal loan?
However, applying for a personal loan requires minimum documents and efforts, sometimes it could be quite challenging to figure out the sequence of actions. The following instructions will help newbie borrowers.
- Choose the most relevant personal loan provider.
- Register on the provider’s website or, if required, install the application.
- Before applying the documents make sure that you meet all requirements (the majority of personal loan providers offer loans only for citizens of the Philippines).
- After ascertaining the term of the loan and it’s amount, fill in the simple application form (on this step you will need your documents).
- Decision on your loan will be ready in 24 hours (providers from the list above make it more quickly).
- Signing agreement will be done by means of an SMS with individual code. It is the kind of second-level verification.
- Receive money and spend it on your needs.
- Payments will be charged monthly.
All personal loan providers have tools called loan calculators. It’s an online device that makes the process of applying for the loan even quicker. Normally there are two scales – days and sum of money. Depending on the values on these scales below loan amount, fee and total payment (including fee) could be observed. The maximum loan amount is not stated and depends on the provider, though usually, it is lower than ₱ 200,000. At the same time in the bank, borrower could take a loan up to ₱ 2,000,000. Nonetheless, it’s a much more complicated task.
Advantages of a personal loan over bank loan
|Bank loan||Online loan|
|Interest rates (annual)||Vary within 1,5% – 2%||Much higher than in the bank (0,25%– 1% per day)|
|0% interest loan for the newbie borrower||Not provided||Depends on the platform|
|Loan amount||Typically, varies within ₱50,000 –₱1,000,000 (the highest limit is ₱2,000,000)||Depends on the platform, but generally it varies from ₱1,000 to ₱30,000|
|Loan approval time||7–14 days||1–24 hours|
|Loan approval statistics||30% of applications are approved||80% of applications are approved|
|Loan term||1–5 years||Up to 365 days|
|Documents required||ID (original document and signed copy);
Credit cart history;
Credit card copy;
ITR (Income Tax Return) latest statement;
3 latest month payslips. The list of documents could vary and become larger, especially if bank loan is secured.
|Legal age and ID
Sometimes employment certificate is required
|Application process||Though the form could be filled in online, an appointment with the credit manager is unavoidable;
Bank registration form is much longer than online loans providers’ form;
Loan approval time could vary within one or two weeks;
Money will be available in 3–5 days only;
Most banks have long requirements list and no loan calculator.
|Online personal loan providers are available 24/7;
Registration takes 5-10 minutes (website or application);
Max 24 hours loan approval time;
Online signing via SMS; Convenient loan calculator.
The difference between bank loans and online personal loans in the Philippines lies in statistics and it is not on the bank’s side. The reason is that personal loans are much easier obtainable. More than that, the absence of obligatory collateral and employment certificate makes this service available nearly for every one of the legal age. And what is more important, the control of loan term and amount is absolutely in the borrower’s hands. As well as responsibility, so it is absolutely necessary to choose personal loan provider wisely!