Three Easy Steps To Getting The Best Personal Loan


Three Easy Steps To Getting The Best Personal Loan

Three Easy Steps to​ Getting the​ Best Personal Loan
Despite what you​ might think,​ getting a​ personal loan doesn’t have to​ be a​ difficult process .​
Whilst it’s true that you​ have hundreds of​ options open to​ you​ and an​ often bewildering number of​ choices to​ make before you​ put in​ a​ formal application,​ it’s quite easy to​ make sure you​ make the​ right decision at​ the​ right time and that you​ also save yourself time and money into the​ process .​
There are basically three steps you​ need to​ take before you​ choose the​ loan that’s right for you:
Step One – Know what you​ want
The first thing you​ need to​ do is​ to​ decide which kind of​ personal loan will suit you​ and your circumstances best .​
For example,​ if​ you’re a​ homeowner then you​ can look at​ taking out either a​ secured loan or​ an​ unsecured one depending on​ your preference .​
If you​ don’t own your own home then you​ will probably be limited to​ an​ unsecured loan.
Secured loans are given to​ property owners and will use your home as​ a​ guarantee against the​ money you​ borrow .​
So,​ if​ you​ stop making loan repayments,​ your lender can use your property to​ recover their loan(s) .​
Because you’ll be using a​ guarantee you’ll generally be given better (i.e .​
lower) rates of​ interest on​ the​ money you​ borrow .​
Unsecured loans,​ on​ the​ other hand,​ don’t need you​ to​ be a​ property owner as​ there is​ no guarantee involved .​
This lack of​ guarantee does make the​ loan slightly more expensive and may also give you​ restrictions on​ how much you​ can actually borrow although this does vary from lender to​ lender .​
If you’re not a​ property owner then this kind of​ unsecured loan will generally be the​ only option open to​ you​ but it’s worth remembering that many homeowners now prefer an​ unsecured loan to​ a​ secured one in​ any case as​ they don’t want to​ risk losing their property if​ things go wrong down the​ line .​
Another choice you’ll need to​ make here is​ whether to​ take out a​ loan with a​ fixed or​ a​ variable interest rate .​
If you​ are given a​ fixed rate then your monthly repayments will stay the​ same all of​ the​ time .​
a​ variable rate,​ however,​ may see your repayments change if​ underlying interest rates change at​ any time.
Step Two – Stick to​ what you​ can afford
It’s quite easy to​ raise finance in​ most cases and it’s very tempting to​ borrow more than you​ actually need simply because you​ can .​
It’s really important therefore that you​ work out exactly how much you​ need to​ borrow and how much you​ can afford to​ repay on​ any loan .​
The key thing to​ remember here is​ that it​ not a​ lender’s job to​ work out how much you​ can afford – it’s your job! you​ can’t blame your lender later if​ they let you​ borrow more than you​ can afford to​ repay.
The easiest way to​ do this is​ to​ look at​ your monthly outgoings and to​ work out how much cash you​ have spare once you’ve met your existing financial obligations and spending for the​ month .​
This sum is​ basically what you​ can afford to​ pay as​ a​ loan repayment every month .​
It is,​ however,​ worth noting that you​ should always leave a​ bit of​ cash spare for emergencies – so you​ shouldn’t commit all of​ your spare cash for loan repayments but should also leave a​ bit to​ cover you​ along the​ way.
You can then check if​ your spare cash and loan amount needs marry up OK by looking at​ an​ online loans calculator,​ for example .​
These tools will let you​ work out how much average repayments may be or​ how much you​ can borrow based on​ a​ repayment sum.
Step Three – Shop around for the​ best deal
Your average personal loan product may well look exactly the​ same as​ the​ next one you​ look at​ but that doesn’t mean it​ will cost you​ the​ same .​
Interest rates can vary widely across the​ industry and you​ can end up paying a​ lot more than you​ need to​ unless you​ shop around for the​ best rates .​
The majority of​ loans will all do the​ same things and will carry exactly the​ same terms and conditions .​
So,​ if​ you​ bear this in​ mind,​ you’ll get no advantage by paying a​ higher interest rate if​ there are no add-on benefits .​
The easiest way to​ shop around nowadays is,​ as​ ever,​ via the​ Internet .​
Even if​ you​ just spend a​ few minutes on​ an​ online loan rate comparison site then you’ll see some big differences in​ the​ interest rates being charged .​
And,​ remember,​ the​ lower the​ interest rate you​ pay,​ the​ lower your monthly repayments will be .​
And,​ the​ less you​ pay back every month,​ the​ less you’ll pay back overall .​
This all adds up to​ savings for you.
If you​ follow these three steps then you’ll be well on​ the​ way to​ finding exactly the​ right kind of​ loan to​ suit you​ best – and you’ll make sure that you​ make the​ kind of​ savings you​ can with minimum fuss and effort.






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