Currently there are two ways to get an injection of money: obtain a private loan from an entity or go to a bank. These routes have a series of advantages and disadvantages that we must know in order to make the best decision.

Differences between requesting a private loan from an entity or a bank

When we need loans for very difficult situations, the most common is to resort to private equity loans, since they usually offer financing when the rest of the doors are closed.

For example, in a situation of needing a loan charging unemployment, the banks will see the operation as risky, whatever our situation or our assets. However, financial credit institutions or private lenders may redefine this risk.

Features when applying for a loan at a bank

The most common is to go to banks that give loans to cancel debts . In these entities, as in private equity, we can obtain loans with a mortgage guarantee, loans for new companies, and another series of loans with property or mortgage loans for companies.

In the event of a default situation, the bank notifies first and then begins to charge late fees until we can catch up, so that only when the willingness to pay is not shown is the name registered in ASNEF.

When we go to a bank to apply for home equity loans or money loans of any other kind, it usually takes several weeks to study the case. In addition, the granting of credits is not carried out lightly, but they are very exhaustive in the analysis of the situation and personal accounts to know if that debt can really be faced or not. Its requirements, imposed by the Bank of Spain, are usually very restrictive.

To this we must add that the objective for which we have applied for the loan usually has to be justified before approving the granting of credit.

Features when requesting money from private lenders

In favor of a private loan, it should be noted that the response is somewhat faster, since their advisers analyze our case in detail and advise us on the option that best suits us, which makes things easier.

The contract that is made with private lenders has less fine print than that signed with a bank, since being adapted to us, it is simpler.

The biggest drawback that we can highlight of going to private lenders is that the interest at which they lend us the money is usually much higher than that of a bank and, on some occasions, it can reach up to 50% APR, when in the bank it is normal is that it does not exceed 15%, depending on the type of operation requested.

How do private lenders act in case of default?

Well, automatically our personal data would be registered in a list of defaulters such as ASNEF or RAI.

What are the advantages of loans from private lenders?

Private lenders and private equity loans offer a number of advantages when it comes to financing us. Among the most interesting we highlight the following:

They are not associated with any type of product

Of all the strategies of banks, the most widely known are to link products to cheap loans. With this the banks make sure to fulfill their sales and obtain a greater profit.

When we go to request a loan from a bank, we intend to obtain the financing and, generally, we do not need any other type of product. The links can be from changing our payroll to that bank, if we do not have it with them, forcing us to open an account, take out insurance that either we do not need or do not cover all our needs, being required to have a credit card and to use it on a monthly basis and a long etcetera.

In the case of going to a private lender, this situation will not occur because they do not link the loan to any product.

Less demanding conditions

If we go to banks that give loans to cancel debts, their conditions are very demanding. This has been a major financing problem since the crisis broke out, since many people could not meet the minimum requirements demanded by the banks.

Currently, thanks to the gradual economic recovery, the need to apply for credit proliferates. If we go to a private loan, a high CIRBE or an unstable payroll will not affect us for the granting of it.

Ease of processing

Private equity loans usually have advisers to give us a personalized service. This is very easy for users interested in hiring a loan, since you do not have to be an expert to choose the option that best suits your situation.

In summary, if we are looking for financing to face some kind of unexpected or to cancel a debt, there are several financing options available to us.

If the bank closes all the doors to us, we will be able to go for a loan through private equity companies . At Fasty Project Loans, they have the best team for advice and financing management, both for individuals and companies, who will help us throughout the process, in difficult situations and with all the guarantees of a bank.

Advantages of private loans
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Miguel Garvía

CEO & Partner
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