Instant Decision Unsecured Personal Loans

by Tracy Murray-Crouch

When you’re trying to get a personal loan, “instant” can mean a couple different things. It could mean you fill out a web form with all your relevant data, click “submit” or “approve me!” and you get an immediate message saying you’re either approved for the loan, or not.

On the other hand, you might consider a 24 hour approval period to be essentially instant, especially consider most loans have approval times measured in days or weeks. So whether you’re looking to be approved instantaneously or sometime tomorrow, you need to understand which aspects of your application make the biggest difference to getting approved for instant decision unsecured personal loans.

What signals are lenders looking for to identify you as “not too risky?”

The first – and biggest – factor is your credit score. There’s no way around it. If you want to borrow money fast you’re going to have to show you’ve been a responsible borrower in the past. Remember, you’re asking them to give you up anywhere between $1,000 and $5,000 in a matter of minutes (or maybe hours). For the lender to feel comfortable with that decision they’re going to have to see glaring proof that the loan will be a good use of their money. Glaring proof in the form of a high Fico score and and a history of making your loan payments on time.

How much does your income matter?

Your income matters quite a bit. Maybe not as much as your credit status, but it’s still a factor because the lender has to see that your income has room for the new payment you’re going to have if they give you this loan. Typically called your “Debt to Income” ratio (or DTI), the lender is going to add the new payment this loan will create to your other monthly debt obligations and calculate whether or not the new payment will overload you.

When you’re trying to qualify for a home loan the standard DTI numbers are typically around 33% of your net income and about 42% of your gross income. The preferred DTI isn’t as well-known for unsecured loans, but it’s logical to assume they’ll be slightly more conservative given the fact that they have nothing to repossess if you don’t make your payments.

If you have terrible credit and a lot of other debt….

Instant personal loans may not be for you. Well, that is unless you want to go the payday loan route. If you’re truly desperate for some cash you can get really fast loans for up to $1,000. But these are “borrower beware” situations. The fees and interest rates on these loans make them a horrible decision for pretty much everyone. Not the recommended path, in my opinion.

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