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.
