Category: Personal Loans

6 Things to Look for in a Personal Loan

If you are shopping around for the best personal loan deal, there are certain things that you need to watch out for. A lot of people just don’t put enough time or effort into this, and as a result they suffer for it financially. You will be glad that you took the time to do this research because of how beneficial it will be for you. Overlooking even one of these things can mean spending a lot more than you have to on your loan as a whole.

1. Interest Rates

One of the most important things to concentrate on when getting a personal loan is the interest rate. The rate that you get will ultimately determine how easy it will be for you to repay your debt on time.

Unsecured loans don’t require collateral, but they do tend to come with a higher interest rate. If you are interested in getting one, it is particularly important to focus on getting a decent rate. Secured loans do require collateral, so the interest rates are usually lower. You do, however, have to make sure you can pay the loan back. If you stop making payments for any reason, the lender can and will repossess your property.

If you want to get the best possible interest rate on a personal loan, it is a good idea to see what each lender has to offer. You also need to take your credit into consideration, especially if you are getting an unsecured loan.

2. Repayment Policies

The fact is that some lenders are more flexible than others with repayment. You need to look for a lender that won’t charge you any fees for early repayment. It’s always a good idea to try to repay your loan before the due date so you can save yourself money. Some lenders charge up to £800 for early repayment, so make sure you don’t fall into that trap.

One of the best reasons to find a lender that is flexible when it comes to repayment is that you can work with them if you have sudden financial problems. If you get laid off from your job or can’t work for medical reasons, you want to know that your lender is there for you.

3. Fees

There can be quite a few different fees with personal loans, which is all the more reason to do your research when shopping around. Make sure that you understand what all of the fees and potential fees are before signing anything with a lender. A small number of private lenders charge multiple exorbitant fees that can make repaying your loan very difficult.

4. Customer Service

The quality of a lender’s customer service isn’t something that most people think about, but it is important to consider. You need to know that you can quickly and easily reach your lender or a representative if you need to for any reason. Take some time to research how good each lender’s customer service is before deciding on one to borrow from. Do they offer a 24/7 live online chat feature? How about email support? What are the hours of the customer support phone line? These are just some of the questions you need to ask yourself.

5. Lender Reputation

The overall reputation of the lender you choose to borrow from will be crucial. You should be able to get this kind of information online without breaking a sweat. If a certain lender has a ton of negative reviews, you will probably want to steer clear. Spend some time doing your research before making a choice. You should also try to find out if any formal complaints have been filed against each lender. Visit the lender’s website to get a better idea as to just how professional they are.

6. Online Application

Filling out an online application for a loan will help you get the money you need faster than if you were to submit physical paperwork. These days even banks and credit unions make it possible to get a loan entirely online. Just make certain that the website you apply for a loan on is secure. If you don’t see the “https” before the website URL, get out of there quick. The last thing you want is for any of your personal or financial details to be stolen.

Who Should get a Personal Loan?

Many people should consider getting a personal loan. If you need money for something important and your finances are at least fairly solid, you should think about this option. There are different types of personal loans and lots of lenders to choose from. You should do the necessary research before deciding on anything in particular. By considering all of these factors, you can borrow the money you need while protecting yourself and your finances.

Things Everyone should know before getting a Personal Loan

If you are thinking about taking out a personal loan, there are some things that you will want to consider before making a final decision. While it’s true that a personal loan can be of great help for lots of people who are in a tight financial situation, you will need to learn the facts so you can make the best possible choice. Getting a personal loan is not something that you will want to rush into.

A Personal Loan is basically like all other loans

You will find that a personal loan is just like all other types of loans in the sense that the borrower pays back the money in fixed instalments over a predetermined period of time. This period of time ranges from one to five years. These loans usually carry fixed interest rates but not always.

There are numerous types of personal loans

It’s also important to keep in mind that there are numerous types of personal loans that you will have to choose from. The two main types of personal loans are secured and unsecured. A secured personal loan requires some sort of collateral/property to be put down in the event that the person is unable to pay back the loan. Typically this collateral is a house or car, though it can be anything of enough value to cover the total cost of the loan.

An unsecured personal loan requires no collateral, so you won’t have to risk losing your car or home if you are unable to pay back the loan. You will want to remember that it can be difficult to get an unsecured loan if you have a low credit score. These loans typically have higher credit requirements due to the fact that there is no collateral required. Either way you will want to make sure that you are able to pay back the money you borrow, regardless of which type of loan you choose.

A Personal Loan may not be your best option

There are tons of different loan options, and a personal loan may not be the right one for you. It is important that you take the time to weigh your options so you can find the best one based on your specific borrowing needs. While it is true that personal loans typically come with lower interest rates than credit cards, you should still keep in mind that it’s not the only option you have. The more time you take to look into your borrowing options, the better off you are going to be.

Choose the right Lender

It is also imperative that you choose the right lender, because there are many different options that you are going to have. Banks are not the only ones giving out personal loans, so you will want to keep that in mind. By spending some time looking for the right lender, you will be able to get the best possible deal on the loan you need. Because there are so many lender options, you will definitely want to make a point of knowing what you have to choose from. Choosing the right lender can mean saving quite a bit of money in interest, so you will have to keep that in mind.

Don’t apply for too many loans

It’s never a good idea to apply for too many loans, because doing so can actually hurt your credit score. When you apply for a personal loan, the lender will check your credit. This is referred to as a “hard inquiry”, which can actually lower your credit score by a few points. The more places you apply, the more your credit score could be negatively affected. You will want to ask lenders about possible rates on your loan before you apply.

Check for any hidden or additional fees

Interest may not be the only cost that comes with your loan, so you will need to make sure that there aren’t any hidden or additional fees before you sign the contract and make everything official. The last thing you want to do is to take out a loan without knowing about all of the different fees that you are going to potentially incur.

The fact is that a personal loan can be of great help to those who are in financial straits, but you will have to be cautious when going about getting one. The more time you take to do the necessary research, the better off you will be in the end. There are many different things that need to be taken into consideration before applying for this type of loan. Those who consider all of these things will be better off for it. In the end you will be glad you did the research.