Searching for Savings-Secured Loans Online vs. Offline

Secured loans are traditionally cheaper for a borrower than unsecured loans. Because the borrower is placing an asset as collateral, the lender is taking on very little risk by funding the loan. Lenders reward this low risk with low interest rates. Nearly any asset can be used as collateral, including homes, cars, businesses and even stocks or savings accounts. Savings-secured loans are funded by the same institution where the account is held. Most lenders offer both online and offline application options for this fairly simple loan.

Advantages of Online Loans

The main advantage to sourcing a loan online is time-efficiency. A borrower can research several lenders in a short period of time. These lenders will often have quick, instant quote forms in order for a borrower to receive a basic understanding of their savings-secured loan rates. If you use online banking for your current savings account, you can usually log right in to your information and have a quote within minutes. This ease of searching lenders makes looking for secured loans online ideal for the very busy borrower. 

Disadvantages of Online Loans

When you aim for greater time efficiency, you will lose some of the personal service aspects of sourcing a loan. Some borrowers like to ask a lot of questions; in fact, asking questions is one of the best ways to protect yourself against predatory lenders. Further, entering personal and financial information to an online database can make you a target for identity thieves. You always should be careful to use only a personal computer when you are looking for loans. You should also be wary of providing personal information very early on in the process. Ultimately, if you are concerned with your privacy, you may not be a good candidate for an online secured loan.

Advantages of Offline Loans

Meeting a lender face-to-face is the traditional way of sourcing a loan. These meetings give you the chance to ask all of your questions. This is also the best opportunity to negotiate your loan terms and rates. Meeting in person gives you a chance to negotiate both the loan and any interest you earn on the savings account with the lender. If you have bad credit, you may need to meet with a lender face-to-face just to get approval. Bad credit borrowers are not always eligible for instant-approval online loans. If you are using your existing bank, you may also take advantage of existing relationships you have with your tellers.  

Disadvantages of Offline Loans

Banks and lending offices are notoriously slow in dealing with customers. You also may only be able to get an appointment during business hours, meaning you will have to take time off work every time you want to meet with a new lender. This time consuming process limits the number of total lending institutions you can evaluate. Borrowers who are looking for a simple answer will have an easier time searching online than talking through every detail with a banker in person. 



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