Sometimes life might be hard on you and you might need cash urgently to fix it. you may try talking to your friends and family for help but they are tight on cash too.
Applying for a loan in the bank is time-consuming and you will need to have collateral and guarantors.
Online loans are easy to apply you just give out your personal details a good credit score history and a referee number and you have cash credited to your account.
Online loans sort out your problems fast but here are the dangers of taking up online loans.
High upfront fees
Before getting your loan approved, some online money lending platforms ask you to pay registration fees and processing fees which are very expensive.
Some might be deducted from your loan or have to be paid prior.
Prepayment penalties
Failure to pay loans according to the stipulated timelines earns you penalties.
You may get a loan extension payment period, but it might be set at around 20%, and since you have no choice, you get to pay the interest rates and the loan.
Harsh collection tactics
When it comes to collecting loans, online money lenders go to extremes.
You receive nagging calls threatening messages from their loan collection agents.
Some agents go to the extent of calling all the contacts in your phone harassing them, and others get into your houses to carry all your property even if it exceeds the loan.
Risk of identity theft
When applying for online loans, you give out your personal information from your real name, id number, residence, and your referees’ number.
If it’s an app on your phone, you let them access all your contacts’ messages and even passwords, and some might be malicious and use your information.
High-interest rates
Applying for an online loan is simple and easy, and in a few minutes, your loan is deposited into your account.
But when it comes to a loan, you have to repay some money, stipulating that you pay 30% to 50% interest rate of the loan received.
Which is very high-interest rates.
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Conclusion
Avoid online loans at all costs . They leave you in debt and their harsh collection methods are detrimental to one’s reputation.
