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Online banking is one of the most talked-about topics in the world, and with a good reason. It is similar to taking out a loan anywhere else but much more convenient and faster. In fact, you don’t have to gather a lot of paperwork, go to a banking institution, and do other unnecessary things to apply for a loan. With online lending, you simply should pick a provider and point out your personal info, as well as the details about your job, source of income, and expenses.

There is no surprise that we have many good online lending providers to choose from. Nevertheless, there are many conservative people who prefer to take out a loan at physical banks or credit unions. According to them, online lending providers lack the security and privacy that are present at physical banking institutions.

While there are many factors to take into consideration when choosing between an online and an offline loan, it really comes down to personal preferences. Moreover, the choice depends on the specific online lender and offline venue in question.

Below, we will leave you with the things to expect when applying for a loan in each way. However, it is totally up to you which option to choose in the end.

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Online Lending

As mentioned above, online banking typically has a fast and easy application form, but receiving funds in your bank account may still take from one to seven working days. It mostly depends on the type of loan you want to take out. For instance, the money from short-term loans can arrive to your account within the same day of approval, while the funds from longer-term products may take a few days.

There are also other factors that determine the time it will take to receive money. The things we are talking about are application time, approval time, and deposit time, respectively. Let’s look at each of the factors in more detail.

Application Time

Applying for a loan online typically takes just a few minutes. You provide basic information, such as your valid SSN and proof of identity, as well as financial information, such as your job, source of income, and expenses, among others. At this stage, you will be pre-qualified for the loan. If you decide to move forward, your provider will review the form and evaluate the chances of approval.

Approval Time

To answer how much time the lender needs to review your request, it is important to know the type of loan you are interested in. Short-term loans are generally approved within a few hours, while longer-term options require several days to get approved. For example, Filld estimates seven minutes on average of review time for payday loans.

Deposit Time

Once you are approved, providers transfer your loan funds, often directly to your checking account. Again, that deposit can take from one to several working days, depending on loan types, how quickly your bank checks the deposit, and other factors. Filld can fund your bank account on the same day after your approval. So, check with your bank to find out when that money is available to spend.

Offline Banking

When it comes to offline banks and credit unions, they may sometimes fund your loan funds within one business day, but the speed varies from one institution to another. Let’s review the same factors as we have done with their online counterparts.

Appointment Time

With brick-and-mortar credit unions and banks, you need to visit a store and apply in person. In some cases, you can quickly set an appointment and get access to the funds faster. In others, it may take up to several days before you can meet with the banker and request the loan. So, applying online from home could be a better option.

Application Time

Offline lending requires filling out an old-fashioned paper application, either with a representative from the institution or without. It is worth noting that when you write something on paper, there is no instant verification, so the chances to submit an incomplete form are higher.

Approval Time

Most physical financial institutions take up to several business days to review your request and evaluate your odds of approval. To speed up the process a little bit, you may back up the info you give to the lending company, and the bank will review your credit report. In theory, you may receive funds on the same day you apply, but that’s sooner an exception than a rule.

Deposit Time

Once again, you may receive the loan money on the same day you apply. That is an advantage if you need quick cash, but keep in mind that many offline institutions take up to several working days to fund your account.

What Makes Online Lenders Better Than Offline Venues?

There are a few things that make online lenders better than brick-and-mortar banks and credit unions. 

First, online providers can tell you instantly whether or not you are approved, how long you may borrow, and what your payments will be.

Second, online lenders tend to offer better interest rates and smaller service charges (if any) than physical banks and credit unions. That’s because online platforms don’t have the same overhead costs as their offline counterparts.

Third, online banking is more convenient since you can take out a loan whenever you want from the comfort of your own home. But it really bild down to what you are looking for in the first place.

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