A few years ago, getting a loan on the same day of filing the initial application sounded like fiction. However, thanks to technology, this has now become reality, as lenders are using artificial intelligence to quickly assess loan applications and give out approval decisions in a matter of hours, if not minutes.
Applying For A Same Day Loan
Although many lenders are offering same-day loans now, the loans are not all of the same types. Also, some lenders only offer same day loans to customers they have engaged with in the past, as they already have a detailed assessment of such borrowers.
The following options and scenarios exist when applying for a same day loan:
- Available for both new as well as existing borrowers
Loan application processes for some lenders are highly automated or very simple, and hence take a very short time to be processed. Such lenders are a suitable option for those individuals who don’t already maintain a history with any lender.
- Available only for existing borrowers
Some lenders only provide same day loans to their existing customers and do not accept new customers. Many types of lenders offer similar perks for their customers, including banks. These types of lenders are a great choice for borrowers who already have a history with the lender.
- Short-term loan providers
Short-term loans are usually very small in value, for example under $2,000 (although a few lenders offer short-term loans up to $5,000 in value as well). Considering the small value of these loans, lenders usually deliver an application decision within a day. These loans are a good choice for borrowers with no history with the lender and are looking for quick access to funds up to $2,000-$5,000.
- A bank overdraft or a credit line
For people with accounts in banks that offer an overdraft facility or a line of credit on their accounts, the fastest and cheapest borrowing option could be to approach their bank and avail these facilities. Overdrafts and a line of credit are usually available for a limited amount, and the applicable rate is variable, as set by the bank. However, unlike an overdraft that is supposed to be taken on top of an existing transaction account, a line of credit is opened in a dedicated account.
- Filing an application in-branch
Many lenders offer same day loans to borrowers who file applications at their branch, provided they bring all the required documentation at the time of filing. Most commonly, the required documents include a valid ID, account statements from the bank, and financial details that provide income/expense/credit information.
- A secured loan
Since a secured loan requires the borrower to pledge an asset as collateral in exchange for the loan amount, the lender’s risk is entirely covered. Hence, fast approvals are usually given for secured loans. Assets that can usually be pledged include jewelry, antique items, cars, or any other valuable item that is not a fast-depreciating asset.
Pre-Requisite To Receive Loan On The Same Day
Many lenders have conditions in place that must be met for a loan amount to be disbursed on the same day of filing the initial application. These include deadlines before an application must reach the lender, such as before 12 PM on weekdays. Some lenders do not make same day loans available to new customers.
These Factors Must Be Considered
Although the ease of acquiring same day loans may imply that they are not as strict as other loans, however same day loans must also be evaluated just as much as any other loan. The following points must be considered before any same day loan application is filed.
- Personal finances: will the loan repayments be affordable considering current personal finances?
- Associated fees and charges: does the lender provide an accurate and clear description of all associated costs? Loan amounts of under $2,000 have been restricted by the government to charge under 20% in establishment fees and 4% in monthly fees. Also, loans that have been taken out after February 2017 cannot be charged a fee on direct debit by the lenders.
- Some lenders charge a fixed fee on a same day loan while others have an interest rate associated with it. Although this can make it more difficult to compare same day loans, however, it’s important to assess the total repayable amount to evaluate which loan is most suitable for the borrower.
- Required information: some same day loan providers may ask for information that might take a long time to procure, such as bank statements. All the required information should be evaluated and collected before filing the application to avoid any unnecessary delays.
- Purpose of the loan: is taking out a loan absolutely necessary? Although a same day loan may be the most convenient option, it is also a costly one. In many cases, it might be better to borrow from a loved one, as same day loans can prove to be expensive.
- Consider alternative loan options: would it be cheaper to acquire short-term credit on a credit card instead of taking out a same day loan?
Required Documents To Apply For Same Day Loans
Some lenders may ask for a few additional documents, but most ask for the following documents at the time of filing the loan application:
- Bank statements showing transactions over the previous 90 days
- Income statements, such as payslips or from Centrelink, or other evidence such as tax returns, to prove stipulated income
- Statements that provide details about a mortgage or rental property, if any
- Utility bills and other expense statements
Tip: Submitting incorrect documents can delay the approval decision on your loan application. Hence, it’s very important that you submit all the documents in the correct format. Calling the lender to ascertain the required documents might help.
The Application Process
The application process to apply for a same day loan is usually online, although many lenders may be able to offer same day loans only if the applicant visits their branch to file the application. To apply online, the form can be accessed by visiting the lender’s website and clicking on the Apply Now button. This will redirect to the application form. Once the form is filled and submitted, the lender will review it and notify the borrower about the approval decision online as well. If approval is given, funds are usually transferred into the borrower’s bank account on the same day as well, although banking channels may delay transactions due to procedural lags.
Can I get a loan in a few hours?
Yes, provided the loan application reaches the lender before a specific time in a day.
Are same day loans available over the weekend?
It is unlikely that lenders would be able to offer same day loans over the weekend. Also, banks are closed over the weekend, so funds cannot be processed until the next working day.
What happens if I don’t repay a same day loan on time?
Failure to make timely payments can result in legal action and application of additional charges by the lender.
Are payday loans same day loans?
Many payday lenders are able to offer loans in a matter of hours, making them same day loans.