How Do You Apply for a Personal Cash Loan?


Quick Answer

Personal cash loans can be applied for through banks and peer-to-peer lending websites. Credit scores and the type of loan being sought will have a bearing on eligibility. The article "Personal Loans 101: How to get the money you need" by Lisa Epstein for Dailyfinance.com provides helpful information.

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Full Answer

Loans can be obtained through peer-to-peer lending websites, such as Lending Club, or through traditional banks and credit unions. Peer-to-peer lending sites allow a borrower to avoid using a banking institution and instead borrow from peers. Some may require a specific credit score, which will be used to determine the interest rate that will be charged. Knowing his credit score ahead of time by checking it through websites like CreditKarma.com will allow a customer to more accurately choose sites that will be able to service him.

Two types of loans can be obtained: secured and unsecured. While secured loans have lower interest rates, they require collateral (prime examples include houses, boats and cars), which can be lost if the loan is not repaid. Unsecured loans, also known as "signature" loans, are issued by banks or credit unions by providing them with a signature. These loans do not require collateral and present less of a loss risk, but they generally come with higher interest rates. A good, long-standing relationship with the bank of choice can make it easier to obtain an unsecured loan.

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