Small Personal Loans Online

Get quick access to small personal loans online via zaving, offering convenience and simple application processes.

Last updated by Zaving Editorial Team, on May 9th, 2024

Are you exploring options for small personal loans online? If you need some urgent cash to get you through a tight spot, you can turn to zaving to help you explore your options. Our online service makes applying for a loan quick, easy, and hassle-free. If your loan is approved, cash can land in your bank account straight away – it's as simple as that! Start the application process right here today with zaving.

What are small personal loans online and how do they work?

Small personal loans online are a type of short-term financing that allows you to borrow a small amount of money, typically between $500 and $5,000, with a quick online application process and fast funding. These loans are unsecured, meaning they don't require collateral, making them accessible to borrowers without assets. They are often used to cover unexpected expenses or consolidate existing debt.

The steps to take out a small personal loan online are as follows:

  • Online application: You can apply for a small personal loan online by filling out an application form that typically asks for your personal information, income details, and employment history.
  • Credit check: The lender will review your credit report to assess your creditworthiness and determine the interest rate and terms of the loan.
  • Approval and funding: If approved, you will receive a loan agreement outlining the terms and conditions of the loan. Once you sign the agreement, the funds will be deposited into your bank account, usually within 1-2 business days.

Repayment terms for small personal loans vary but often involve fixed monthly payments over a predetermined period. Interest rates can be fixed or variable, depending on the lender and your creditworthiness.

How are small personal loans different from payday loans?

Small personal loans and payday loans both serve as quick cash options but diverge significantly in terms, costs, and suitability for different financial needs.
Small personal loans, being unsecured, generally range from $2,000 to $5,000 and offer repayment periods spanning from 12 to 60 months. With interest rates typically ranging from 6% to 36%, they are more cost-effective. These loans are ideal for larger expenses like debt consolidation, home repairs, or medical bills, especially for borrowers with good to fair credit as they offer more favorable terms.

Conversely, payday loans, also unsecured, cater to smaller amounts, usually from $50 to $1,000, and mandate repayment within a shorter timeframe of 2 to 4 weeks. However, their interest rates soar significantly, often ranging from 391% to 782%.

Primarily intended for short-term emergencies and individuals with limited credit options, payday loans should be considered sparingly due to their high costs and potential to lead borrowers into a cycle of debt.

Key differences between small personal loans and payday loans encompass the loan amount, repayment term, interest rate, and credit requirements.

Can I get a small personal loan online with bad credit?

Securing a small personal loan online with bad credit is feasible but may require additional considerations. Lenders will evaluate your credit score to determine the interest rate you qualify for. However, lenders specializing in loans for borrowers with bad credit may also examine other factors like income stability, employment status, and overall financial health to assess your eligibility.

Remember that having bad credit can restrict your options and potentially lead to higher interest rates or stricter terms. 

Here are some tips for obtaining a small personal loan with bad credit:

  • Compare interest rates: Obtain quotes from multiple lenders to find the most competitive interest rate. You can compare rates online or visit your local bank or credit union.
  • Prepare documentation: Lenders will require proof of your income and employment. Gather necessary documents like pay stubs, W-2s, and bank statements.
  • Consider a cosigner: A friend or family member with good credit may be willing to cosign your loan, potentially securing a lower interest rate.
  • Develop a repayment plan: Before taking out a loan, establish a clear strategy for repaying it. This will help you avoid missed payments and maintain a positive credit history.

More of your frequently asked questions about payday loans

How can I improve my credit score?

Elevating your credit score involves pivotal steps: check reports for errors, pay bills on time, and keep credit card balances below 30% of the limit. Maintain a stable credit history, diversify credit types, and limit new accounts. Explore credit-building options and seek guidance for consistent improvement.

How quickly can I get a small personal loan?

The speed at which you can secure a small personal loan hinges on various aspects, including the lender's processing procedures, your credit standing, and the complexity of your loan request. However, if approved, you can generally expect to receive your loan funds within one to five business days.

Are there restrictions on what I can use my small personal loan for?

Small personal loans offer a versatile approach to financing, unlike designated loans like mortgages or car loans, which often impose strict usage limitations. This flexibility empowers borrowers to utilize the funds for diverse purposes, such as debt consolidation, medical expenses, home repairs, or managing unexpected costs. However, it's crucial to discuss any potential restrictions or specific terms with your lender before proceeding.

How do I choose a small personal loan?

Selecting a small personal loan involves assessing your financial needs, comparing interest rates among lenders, focusing on the APR, evaluating loan terms, checking your creditworthiness, exploring cosigning options, comparing fees, understanding the loan details, and seeking professional guidance if necessary.