There seems to be some confusion these days about what exactly Mobiloans can provide in the terms of a loan or a line of credit. The answer to this question is that they provide both, where a customer can elect to get a full loan (in which they take the full amount of their line of credit all at once) or they can have an outstanding line of credit where they only access a small percentage of that credit line.
Mobiloans is the only Native American lender to go down this road, where the company provides an existing (available) line of credit rather than just a set amount (fixed) loan. This is an interesting step by Mobiloans, and you have to applaud the firm for being creative. I've been talking about how some of these tribal lenders should break with the standard (and very boring) format of issuing simple loans of $300 to $500 for 14 days at 30% interest per pay period. No thank you. Mobiloans said the same thing and has moved in their own direction.
So here is how the Mobiloans credit line works...
Just like all loan companies you have to apply and qualify to get the loan, but this is a simple process. If you have a job and you are over 18 years old you basically have already qualified. When you qualify for the Mobiloans line of credit you do not automatically receive a loan as you do with all the other Native American lenders. Instead, you now have an outstanding, available line of credit to draw on when you want it. Now a word of reality here, there is a very good chance that a high percentage (let's guess at least 60%) of all customers will be taking the full available amount of the line of credit. In other words they will take 100% of the credit line right away and thus it will be just like a regular loan to so many customers. But that's beside the point, the fact is this is a different type of product.
Let's use the example of $1,000 line of credit that is granted by Mobiloans. So now you can opt to receive that amount on a demand basis. That's what a line of credit is, a loan that you can break apart, get part of at one point in time, pay back some of it, and then take out more of the loan later on. This is a great level of flexibility for a consumer who wants to have this type of on demand funding available, especially for certain points of time. For example, let's say a person is getting ready to go on vacation or Christmas is around the corner. That consumer could use this line of credit as a back-up batch of funds to pay for gifts, travel costs, or any other costs that require quick funding.
The Mobiloans line of credit is also a great vehicle to pay for emergency situations. And this is an important point, because nearly all of the Native American lenders (and practically all of the standard payday loan shops) advertise their loan products as a great alternative to getting bank fees, overdraft fees, or paying late fees on utility bills. But Mobiloans has made a product that actually fits the role of emergency funds much better than just getting a standalone loan product. Mobiloans will keep the funds available, on hand for when you need them. If a customer takes those same funds and puts them into their bank account there is a really good chance they will find their way to being spent on something. The company, and not you, acts as the custodian for the funds, holding them in reserve until you make the call to get that money. If you think about both options, the Mobiloans method makes a lot more sense as a source for emergency funds.
Mobiloans has a maximum of $1,500 for their line of credit. This is not bad, although it would be better to get that maximum amount up to $3,000. The minimum amount is $100, which almost doesn't seem worth the time.
One more note about the line of credit, it differs from standard loans because once you take a regular loan that's the end of the story. You need to make payments on that loan. You can repay the whole loan, repay part of the loan, or just pay the current finance charge. But you can't have any new money until you fully repay that loan, and then probably wait two or three more days. This is not the case for Mobiloans. If you have a $1,000 line of credit with Mobiloans and you take out $300 to use in September, you have the option to take out the other $700 in October. So with both a regular loan and a Mobiloans you have to make your bi-weekly payment, but with Mobiloans you have the ability to access fresh funds where the regular lender is going to say "No" to any additional funds until you have that first loan completely paid off.
The company also impresses by having a lower interest rate than most other tribal loan companies. For example the first repayment amount on a $1,000 loan amount is going to be $150. That's not bad at all, in fact it is excellent when compared to most other loan firms either online or the physical payday stores.
Another quality component of all the loans taken from Mobiloans is that every repayment amount has a decent portion that goes to the principal amount. Most lenders will allow several (front end) payments that only pay finance charges. This is a meaningful situation, because most tribal lenders have no problem letting their customers pay a finance charge and extend that loan multiple times. An unfortunate customer for a payday lender that keeps extending their loan can pay 10 or 15 finance charges over the course of six or seven months, making no progress at all against the original (principal) loan amount. Mobiloans has built-in a function that will not allow this to happen. Each and every repayment date includes some substantial amount of principal.
Mobiloans is superior to nearly all other tribal lenders. For all of the people who complain about payday lenders and Mobiloans, it's time to make a distinction here. Yes, the firm does have relatively high interest rates if you compare to old fashioned loans from 10 years ago. But those days are long gone. Mobiloans provides a good loan product that has very flexible options with lower interest rates than payday lenders. Do not just throw Mobiloans into the payday loan camp because this is a different product.
Anytime you are considering a loan, and assuming you are not in the 5% of the U.S. population that still qualify for a tradition bank loan (signature loan) then head over to the Mobiloans website and apply. Then shop their offer against any other company, whether it's an online loan or a physical loan store.
There is a really great chance that Mobiloans is going to win that comparison.
Be serious when it comes time for you to give out your individual information when requesting a payday loan. You see the lender can and will verify your salary at least typically they do, and before you get any money deposited into your account they will see if you are telling them the truth. The point is don't think you can just qualify for the loan by saying anything on the application that looks good.
Posted by: Gayle Owens | 10/28/2013 at 10:06 PM
Yes! Finally something about personal loans for bad credit. There are so few people writing about this. All loans are super expensive.
Posted by: Get Me A Loan | 11/22/2013 at 06:21 PM
My experience with this company is much different than your description
Posted by: Eddy | 12/21/2013 at 08:03 PM
Mobiloans gets some good reviews but not from me. They are too expensive and they let the loans stretch out for months on end, no end in sight. They can lower the rates they charge I know they can but they do not and will not because they are making great money doing what they are doing.
Posted by: Ellen Fox | 01/09/2014 at 08:01 PM
That is a very good tip especially to those fresh to the blogosphere. Brief but very accurate information… Thank you for sharing this one. A must read article!
Posted by: Good Stuff | 01/11/2014 at 11:20 AM
Oh my goodness! Awesome article dude! Do you have an RSS feed? I don't know why I cannot join it. Anybody who knows the solution can you kindly respond? Thanks!!
Posted by: Payday Loan Guy | 01/23/2014 at 09:44 AM