Where Can I Get a Loan?

Louisa wrote in: “Hi! Please tell me, where can I get a loan? I love your site – but I was looking for a resource to help me with applying for loans, specifically a place where I can get a list of other places to apply to.”

Louisa, thanks for writing in! There are quite a few places to get a loan and we’ll do our best to cover them all here.

1. Check your local bank(s). This may be the best place to go since it’s close to you and you’ll have the ability to talk to your bank representatives in person.  Your bank rep/loan officer will be able to go over your credit score and existing financial obligations (i.e. loans, equity lines, mortgages, credit cards, etc) and let you if you qualify for a loan, and for how much and at what annual percentage rate (APR).

It is a good idea to compare banks and their rates where you live. It can be time consuming to visit multiple banks, but spending even just an hour a day for a few days over the course of a week’s time can save you lots of money if you save even a percentage point on your interest. Don’t be afraid to ask for a better rate somewhere else! Some banks may also have rewards/loyalty programs to help you save a little bit on interest rates.

2. Try online lenders for rates and other fees/prices. Some “online lenders”, like TDBank, also have physical locations but you can certainly apply for a loan online as well. We still think that visiting in person is the better option but applying online (and then speaking on the phone to a rep) can be great too.

Quicken Loans is a great place to look into – they specialize in refi mortgages (refinancing), new home mortgages, reverse mortgages, and FHA and VA loans as well. As of this writing a 30-year fixed mortgage APR was 4.375%; compare to LendingTree where it’s 4.39%.

If you’re shopping for a mortgage we encourage you to use this loan calculator and Amortization from Bankrate to find out what you could be paying on a hypothetical loan.

For auto loans, Banks like Capital One, Wells Fargo and others offer these online too. We found a nifty little auto loan calculator online at Edmunds where you can enter in your vehicle cost, down payment, trade in (if any) and other information to determine a monthly payment and total loan amount.

In a May 31, 2011 article, USA Today reported that more motorists are paying off their auto loans (auto delinquencies fell nearly 26% in the first quarter of 2011); and that auto lenders are starting to lend more money this year. In fact, loan originations increased 22% in the first quarter of 2011, compared to in 2010. Now is a pretty good time to get an auto loan!

3. If you have exhausted all other options mentioned above, you can try to seek out a personal loan, which will usually come with higher fees and interest rates compared to other loans. Personal loans have virtually no restrictions on their use; typically a personal loan will not require collateral (though some places do require collateral for loans above several thousands of dollars).

Capital One says on their website that good credit is all you need to qualify for a personal loan; Wells Fargo has personal loans that start at $3,000 while CitiFinancial offers personal loans starting at $300. Bank and America and Lending Tree offer personal loans, both online and in-person, as well.

4. Still can’t get a loan? If you have bad credit and really need money desperately, then you may have to seek other payday/personal/instant loans as a last resort. Remember that typically when you have bad credit you’ll usually be paying a higher interest rate on loans, and even more on payday/instant loans. In these cases it is very important to make sure you pay your loan back – and if possible, pay back extra when you make payments – so you don’t end up paying tremendous fees.

The Better Business Bureau warns against deceitful online payday lenders. You know the old saying, if it sounds too good to be true, it usually is. Sites like OnceClickCash.com, 500Fastcash.com, rbtloans.co and Ameriloan.com have been responsible for turning quick and easy loans into what “quickly” becomes a debt trap and downward spiral for the loanee. As the BBB article states, one Massachusetts woman made over $1,700 in payments to pay off a loan of only $225. Be very careful out there!

Are you considering a payday or instant loan? You do have options. Here are some quick tips for getting payday/instant loans:

• Try to find in-store locations before seeking online ones. Online lenders tend to be able to “go away” quickly if they want to and can become hard to contact. A brick and mortar lender will enable you to see your loan representatives face to face. You’ll also have the ability to ask them questions about interest rates, fees, and so forth.
• Be on the lookout for shady offers. Anyone who says they can lend to you with just a bank account (and no other information) is most likely not too reputable. (Think about it: if you wanted to lend money to someone, would you only look for a bank account or would you look for a little more information?). Other red flags can include a lack of contact information like address, location, phone number on the lender’s website.
• You have research tools at your disposal! The BBB search section can let you type in a website address, company name, etc so you can do some research on a potential lender before committing any of your information.

We’ve also written an article here on our site talking about the truth behind payday loans. We suggest you read this and also emphasize that these loans should be a last option following any efforts to secure other loan types from lenders mentioned above in points 1-3.

We will update this article periodically to reflect new information and rates, so check back occasionally!