Can online loan portals offer you a better deal?

It is always advisable to compare rates from several lenders before you take a loan. This has become easier, thanks to the profusion of loan aggregator websites. With just a click of the mouse you can compare the rates offered by multiple lenders. Convenience and wider choices are not the only benefits.

The online process is simpler and faster. “Loan offers can be generated in under a minute and an online approval takes five minutes,” says Tejasvi Mohanram, founder and CEO, Rupeepower.com.

These online loan portals also provide guidance to the customer — either online or through the telecalling facility. “Many customers are looking for something beyond a plain comparison. They want an advisor who will hand-hold them through the entire process, including the documentation,” he adds.

Loan aggregators claim they can get you a better deal than if you approach a lender directly. “We do negotiate the rates on behalf of the customer,” says Adhil Shetty, CEO, Bankbazaar.com. Though all aggregators claim to offer the lowest interest rates, it’s always good to verify these claims.

Given these benefits, it seems that shopping for a loan on the net should be the preferred choice. But there are a few pitfalls too. While these services are free, some companies sell your information to lenders.

“The price a customer pays is loss of data privacy. Some aggregators sell the customer details to as many as 4-5 different buyers,” cautions Vineet Jain, managing director, loanstreet.in. So, go through the privacy policy of the website before you key in your details. Or be ready to be inundated with calls from lenders.