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Private Loans Ontario
The excitement of knowing you have other options to borrow from can really bring you joy, especially when you have been rejected several times by traditional lenders.
Private loans Ontario which is the common phrase people use to search for private loans in Ontario are just what you are looking for.
Having a bad credit history is one of the scariest things that can happen to a borrower’s credit especially when you are hit with financial issues and need a loan.
Private lenders are however available to help out borrowers who have been rejected by traditional lenders at interest rates that are a little higher.
Why is it called private loans?
Private loans have their name because they are loans given to borrowers by individuals or private organizations.
Usually, the individuals or businesses who get loans from private lenders are people known to the lenders so they have a relationship.
This can be family or friends, colleagues at work or even church members. But this kind of transactions are more informal.
The more formal kind of private lending is when private organizations lend money to individuals or businesses using more formal means like that of the financial institutions.
With the formal type of private lending, borrowers have to fill forms that request for specific information that the lender uses to decide whether you qualify for the loan or not.
Even though private loans are given to borrowers by lenders who have a makeup that is comparable to traditional financial institutions, the differences in them are also very vast.
Lenders of private loans in Ontario give loans at interest rates that suits them as well as other fees.
Most of the lenders do not follow the regulations set down by the government or governing agencies.
More reason why you have to be very vigilant in choosing private loans from lenders who are not well known to a lot of people.
It will save you the trouble of falling into the hands of fraudsters who will dupe you of your money or even steal your identity.
Fortunately for private loans, there is no delay because the application does not have to pass through different departments for approval, therefore, loan approval is fast.
Advantages of private loans in Ontario
• Less documentation :
If you have ever gone for a loan from a traditional lender then you will know how much you have to produce in terms of documentation to qualify for a loan.
These documentations probe into your life and as if that is not enough, it takes a very long time for your application to be processed.
Less documentation is needed when you need private loans in Ontario.
The lender will request for collateral depending on the amount of money you want as a loan.
Depending on your relationship with the lender too, you can negotiate the interest rate to suit both you and the lender.
• Approval and funding are fast :
When the traditional banks are taking weeks and even months depending on the application to give loans, private loans are granted very fast.
As a borrower, if you meet all the requirements, you do not have to wait for weeks or a month to get the money you requested for.
Anybody who goes for a loan does so because he or she needs money as fast as possible, so the long process causes problems hence the reason why borrowers opt for private loans.
• Terms and conditions are flexible :
Traditional banks and institutions have cut out terms and conditions that apply to all customers of theirs.
But private lenders its different, the terms and conditions can be adjusted according to how well you are able to negotiate or depending on your relationship with the private lender.
Each client of a private lender who wants private loans in Ontario is dealt with on an individual basis.
So you might go to a private lender for the same amount as another client but he or she will get a different rate from yours.
Disadvantages of private loans in Ontario
• Interest rates are high
The risk is higher with private loans as compared to traditional loans, hence the high interest rate attached to such loans.
The process of getting private loans in Ontario is fast because the lender has limited information on the client. The lender might miss out on some information on the borrower.
To make up for this, the lender gives the loans at high interest rates so that in case of default, the borrower would have paid a substantial amount already.
Collaterals that are more expensive in worth are requested for by lender so that it can be sold in case the borrower defaults in paying back the loan.
• Private loans are normally borrowed on a short term basis
If you need a loan that has a longer tenure, private loans might not be the best choice because most of the loans are given for short durations.
Since the lender gives the loan based on the relationship they have with the borrower, sometimes no collateral is requested for as security.
And the longer the loan tenure is, the riskier it is for the private lender because the borrower can easily default if he or she loses their job, or maybe is involved in an accident.
What traditional banks and financial institution do is to give short term loans at much lower interest rates as compared to long term loans to take care of any risk that might come up.
Summary of private loans Ontario
If you have been rejected by traditional banks and traditional financial institutions, don’t be discouraged because private loans in Ontario is here to help you out.
It is very likely your credit scores is nothing to write home hence the rejection from the traditional lenders.
You can take private loans because the lenders of private loans do not dwell that much on your credit scores but on your ability to pay back the loans and also if you have collateral to put down as security.
Another thing that will go in your favour to get private loans is establishing a good relationship with your lender.
Disclaimer: All loans offered through this website are subject to credit and underwriting approval. AfterLoans.ca is a lead referral company, not a lender. AfterLoans only works with financial service providers that adhere to Canadian laws and regulations. You can borrow up to $20000. Loans amortization is between 6-36 months. APRs range from 19.99% to 55%. The actual APR charged will depend on the lender’s assessment of your credit profile. For example, on a $1000 loan borrowed for 12 months at 29.9%, the monthly payment will be $97.24; with a total repayment, including interest, of $1166.88 There is also lender’s optional loan protection policy. In the event of a missed payment an insufficient funds fee of around 45$ may be charged (dependent on the lender). If you default on your loan payment plan the lender may terminate the plan and the remaining balance will become payable immediately. Our lenders employ fair debt collection practices, but will pursue the payment of Outstanding debts to the full extent that Canadian law allows.