Online vs In-Person Loan Application: Which is Better?
8 Min Read
Reviewed by Michael Lefler With the help of technology, you can request a loan from the comfort of your home. Statistics show that nearly 65% of customers prefer online applications when it comes to borrowing. At the same time, some Americans still apply for loans in person due to the unique benefits this method offers. In this article, we will look at each process and consider factors that help you decide which is more suitable.
Pros and Cons of Applying Online vs. In-Person
Before deciding on what method to choose, consider the advantages and disadvantages of both options:
In-Person Application
Pros:
- Personal interaction. You can ask questions and get immediate answers from a loan officer or build strong relationships.
- Guided assistance. In-store lenders can help you navigate the application process and complete all the paperwork.
- Discounts on interest rates. You can access certain discounts on interest rates, if you have an existing bank relationship.
- Better for unique circumstances. If your case is specific, you will be able to explain it in person to your branch manager.
- Expert knowledge. Loan officers may have extensive knowledge of the loan industry, which could be beneficial, especially for first-time borrowers.
- Feeling of trust. When you apply in-person, you know exactly who receives your personal information.
Cons:
- Time-consuming. You need to schedule your visit to the physical location and stay in line to speak with the loan officer.
- Limited working hours. When you go in the store, you have to stick to the lender’s operating hours, which are usually from 9 AM to 5PM.
- Less privacy. You could be embarrassed to discuss financial problems with the branch manager.
- Slower process. It may take about 30 minutes to complete the loan application process.
Online Application
Pros:
- Convenience. Apply anytime from anywhere, 24/7, without the need to visit a physical location.
- Fast processes. Online applications are often processed faster due to automated systems used. This results in quicker loan approval and funding.
- Access to comparison tools. Online lenders often allow you to prequalify from multiple lenders and compare their terms.
- Privacy. You don’t have to explain your money problems to the branch manager.
Cons:
- No human interaction. If you apply for a loan for the first time, you have nobody near you to ask the basic questions.
- Potential technical issues. Website issues or Internet problems may hold you back from applying for an online loan.
- Security risks. There are potential risks of online fraud or data breaches, even if the website uses modern security protocols.
- Limited support for complex cases. It may be difficult to lay out your unique situation or get personalized advice when you fill out an online form.
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Which Option Should I Choose: In-store or Online Application?
The application method you choose depends on your personal preference and expectations.
Here are several situations when online loan application will work better for you:
- You are tech-savvy. This method will suit you if you’re comfortable with using your mobile phone or laptop and share your personal data online.
- You don’t have a strong relationship with your bank. People who are in good standing with their banks can expect to get better loan terms. If you’re not one of them, you may find better loan offers online.
- You don’t want to leave your home and speak to someone. Online applications don’t involve human interactions and tiresome store visits.
- You need money quickly. Online loan providers usually deposit money faster than traditional in-store lenders do. You can typically access the funds within one business day.
Below are the cases when in-store application is more a suitable choice:
- You prefer a personalized approach. If you want to talk face-to-face to a loan officer and ask them some questions, this method will be better for you.
- You apply for a loan for the first time. First-time borrowers often need help with filling out the loan request form.
- You have specific circumstances.Standard online forms usually can’t take into account your unusual situation so you may need to talk to a loan officer in person.
How Does In-Person Application Work?
An in-person application requires you to visit a lender’s store. Here’s how it typically works:
- Gather information and documents. Review the lender’s requirements regarding documents. You should typically prepare your ID and SSN, proof of income (pay stubs, bank statements, tax refunds), proof of address (utility bills, rent or lease agreement), and proof of employment.
- Visit the lender’s physical branch. You might need an appointment but many institutions allow clients to simply visit a store without one.
- Fill out the application. Specify the loan amount you need and provide the basic information, such as your full name, age, contact details, employment history, and income details.
- Get the interview. The loan officer may also ask you about your financial shape and the purpose of the loan.
- Undergo a credit check. Traditional lenders will evaluate your risk level and capacity to pay by performing a credit check. The loan decision will be made based on this information.
- Receive approval decision. If you qualify for a loan, you’ll receive a notification about your approval. It may take from one to several business days.
- Sign the loan agreement. Read the loan terms carefully and accept the offer by signing the loan agreement. This may require you to visit a lender’s store once again.
- Receive your money. The funding times range from 1 to 5 business days, depending on the lender on your bank’s cut-off times.
- Repay the loan. You need to pay back the amount borrowed plus interest according to your repayment schedule. It may include equal monthly or bi-weekly payments. You may set up an autopay or do this manually.
How Does Online Application Work?
Borrowing online is typically easier and less time-consuming. Here’s how the online loan application process typically works:
- Choose online lenders. Pay attention to the lender’s terms and requirements, licensing details, and the client’s feedback.
- Prequalify. Online lenders often allow you to prequalify for a loan, which does not involve a hard credit check. By doing this, you can estimate the potential loan amount, repayment period, and interest rate.
- Choose a loan. Compare offers from several lenders and select the loan with the best possible terms.
- Complete the application form. Specify your personal and financial information via the lender’s website or app. You may also be asked to provide proof of employment and income.
- Get a loan approval decision. After assessing your application details, the lender will decide on whether to give you a loan. This generally takes a few minutes to a few hours.
- E-sign the loan contract. If approved, you will receive the loan agreement via email. To accept an offer, you need to re-check the final terms and e-sign the contract.
- Get your loan. It usually takes up to 24 business hours to get an online loan. The money will be transferred directly into your bank account or debit card, depending on the lender’s policy.
- Make payments. Almost all online lenders allow automatic payments from a borrower’s bank account. This helps avoid missing due dates.
Apply Through 1F Cash Advance Today
1F Cash Advance is a lending company that offers both online and in-store applications to meet each and every needs. You can fill out a form on our website to get prequalified in minutes or find our store near you for personalized assistance from our team of professionals.
Final Thoughts
Whether you should choose an online or in-person application depends on several factors, such as personal preferences, confidence in using the technologies, and loan requirements. Online loans are very convenient, fast, and easily accessible. The online application allows you to choose several offers at once and get approval faster.
On the other hand, applying for a loan in person is more customer-centered since you can ask questions and get answers directly from a loan officer. This traditional way better suits people who still want to discuss financial matters personally. To choose the right option, assess your current situation and see how both methods suit it.
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