The Types of Emergency Loan Lenders
Posted on 18. Sep, 2009 by admin in Loans
There are basically two types of emergency loan lenders – direct lenders and loan brokers. Payday loans come directly from the source generally, the source being people who lend the money. When it comes to loan brokers, they have a hierarchal structure. It means that, they have people working under people, intermediates, etc. Since there is a lot of networking and indirect connections involved, the fees of loan brokers is higher than that of direct lenders. Their interests are higher too, generally charging 30% interest rates on short term loans. It is imperative that the customer knows who he is borrowing money from.
Direct lending is more straightforward and transparent. The application is filled online, and when approved by the loan lender, the money is sent to the customer’s account. These loans are for a period for around two weeks and the lender withdraws the amount from the customer when the due date is reached. It is risky to borrow money through indirect lending (brokers), and hence the customer has to be aware of the borrowing source and its authenticity. This is because the source selection could save a lot of money in the entire lending process.
