How to Choose Between Storefront Lenders and Online Lenders

The choice of where to borrow money is not always easy. After all, there are different types of financial institutions that offer such a service and they all have their own pros and cons. Storefront lenders and online lenders continue to be the most popular choices, though. While companies like Storefront Lenders LLC can provide you with more information between the two, allow us to give you a quick idea through this quick article as well.

What Are Storefront Lenders?

In order to provide you a better insight, let us first define the terms in question starting with storefront lenders. What kind of financial institution are they anyway? 

Here’s the most simple definition: a storefront lender is a lending company that has its own brick-and-mortar office where you can apply, receive money, and pay for your loan. Some of them have an online presence in the form of a website, business listing, or social media account. However, they do not typically receive and process requests online. They do most of their transactions online.

What Are Online Lenders?

On the other hand, online lenders are lending companies that process all their transactions online. Hence, they usually don’t have a physical headquarters for you to visit. From initial inquiry to payment, you will be given the chance to contact these companies through their various online channels and platforms.

Weighing Your Options

You probably have an idea of how the two differ already, but let us look at the factors that further set them apart to help you make a smart loan decision.

  • Convenience. Due to their nature, online lenders are typically considered more convenient than a storefront one. They will allow you to process your loan through the comforts of your own home, after all. This is a good thing if you lead a very hectic life and you won’t be able to visit the storefront lender during their office hours.
  • Legitimacy. Since storefront lenders apply for an actual location, they are bound by state law to apply for various certifications and permits before they are allowed to operate. On the other hand, we acknowledge that there are people out there who believe that if the transaction is not traceable in an online record, then it didn’t happen.
  • Credit Score. Since they only have your online records and digital documents to refer to, most online lending companies are a lot stricter when it comes to their credit score and eligibility requirements. It is also not that surprising for them to offer higher interest rates and more rigid payment terms. 

Storefront lenders, on the other hand, tend to be more understanding of their clients’ needs not only due to state regulations but because most of them really try to establish a more personal relationship with them. It is also important to note that some online lenders have an automated system that their agents won’t be able to influence even if they wanted to. Meanwhile, storefront lenders have a chance to be more understandable in making changes to your account since they are not burdened with this system.

  • Assistance. Finally, storefront lenders can potentially offer you a higher quality of assistance due to the human interaction that they provide. It can sometimes be difficult and frustrating to communicate online especially when you’re unsure when they are going to respond to your queriesーor if they’re going to respond at all. Storefront lenders are also known for their promptness. It is not unheard of for a borrower to visit a storefront lender’s office for the first time and walk out of it with their needed money on hand.

Each lender company definitely have their own pros and cons. We believe, though, that the primary hurdle that storefront lenders must overcome is their company recognition. Since most of them are not found online, they can be difficult to locate in the physical world. Fortunately, there are companies like Storefront Lenders LLC that are slowly changing this minor inconvenience.

Storefront Lenders LLC

They are a company that offers a digital marketing platform to help storefront lenders launch targeted campaigns. What we like most about Storefront Lenders LLC’s services is the fact that they cater to both the lender’s and consumer’s needs. By helping the lending institution gain more online renown (and thus, more potential revenue), they are also helping consumers locate the storefront lenders in their communities easily.

Conclusion

In the end, it will still be up to you to determine which of these lending companies will be able to meet your needs and preferences

Storefront lenders are perfect for those who want to establish a human interaction and sometimes for those who need a lending company that will be more understanding of their credit score.

On the other hand, online lenders will continue to be the most convenient option for those who don’t have a choice but to process their transactions after business hours. 

About Mohit Tater

Mohit is the co-founder and editor of Entrepreneurship Life, a place where entrepreneurs, start-ups, and business owners can find wide ranging information, advice, resources, and tools for starting, running, and growing their businesses.