Personal Loans – 8 Useful Tips
So, you need money and you think about borrowing it from some money lending institution. No, we’re not going to be judgmental about it, we’re here to help you! Let’s present you 8 useful tips on taking out a personal loan!
1- Shopping around is welcome! When it comes to taking out a loan, just as with other financial products, it pays to compare prices and annual percentage rate. Although your current bank might claim it offers the best rates, you should check others lending institution. If you find a cheaper loan elsewhere and this moneylender has a good reputation, go for it.
2- Checking the small print is a must! Before applying for a personal loan, make sure you’re eligible. Some lending institutions offer really cheap loans but with some crazy conditions, such as shopping at certain chain stores in the past several months.
3- Consider early repayment charges. Even though it might seem unlikely now, it is still possible you’ll be able to pay off your debt earlier. In case you do so, many moneylenders are going to apply a charge, therefore it’s better to check how much it might cost before getting a loan. If there’s a good chance you’ll be able to settle that loan early, it’s recommended to search for a deal without repayment charges.
4- Your credit rating is important. Did you know that lenders offer their advertized annual percentage rates only to two-thirds of applicants. This means that if you have a bad credit, chances are your application would be denied or you may be offered higher rate loan.
5- Credit card might be better choice. It’s important to consider other credit forms, before applying for a personal loan. For example, some credit cards might be cheaper than a personal loan. However, some people are simply not qualified for credit cards and simply have to take out a personal loan.
6- The larger the loan, the lower the rates. Does this mean you should borrow more? Well, in some cases you can actually save some money by borrowing slightly more. However, be careful with this tip, especially if you’re a shopaholic.
7- Apply to just a few loans! Your loan application will leave a footprint on your credit records. When you apply for any loan, your credit history will be checked before you get the approval. If you have too many applications on your credit record, it might seem you’re in financial difficulties and moneylenders will most likely see you as more of a credit risk. In that case, your loan application is more likely to be denied.
8- Secured loans are risky. Yes, a secure loan might be cheaper than the unsecured one, but you could lose your home in case you don’t keep up repayments. A secure loan is only offered to a homeowner with equity in property, meaning the moneylender takes a charge on borrower’s property. Unless you’re 100% sure you’ll be able to meet the repayments, don’t sign up a secured loan. Basically, this type of loan is riskier for a borrower and less risky for a lender.
Finally, once you become sure you want that personal loan and this moneylender (for example www.expressloans.com.sg) is the right one, I’m sure you’ll be lucky enough to make the best out of it!