Whether you’re taking out a loan to buy a car, invest in a house or pay off credit cards, it’s important to choose a company that can give you a good deal and allow you to repay the loan at an interest rate that suits you.
Financial experts recommend that loan applicants appeal to family and friends before they make formal applications for loans. The reason for this is because a loan package is crafted on a basis of profit and risk, and the terms are generally beneficial to the lender and not the borrower.
The other reason is that there are penalties for defaulting on loan repayments, but there are also penalties for those who repay loans early. Some lenders provide loans for periods of six months or one year while others will offer long-term loans of five or more years, and thus it’s important to shop around.
All kinds of institutions provide loans: banks, building societies – even supermarkets – and you may come across small firms who offer attractive packages. This is not a strictly regulated area, and it’s important to check these firms’ reputability before entering into a loan agreement with them.
You can search for Companies House information at Duedil to find financial histories dating back 20 years, for free. This information can help you decide whether a loan lender will provide you with the best interest rates available on the market at the moment.
While you’re choosing lenders carefully, they’re also selecting applicants on a basis of credit histories, profit and risk. Lenders want to ensure that a loan applicant presents opportunity for profit and does not have a history of debt or unpaid loans.
Using information from credit reference agencies, Experian, Equifax and Callcredit, financial institutions can approve an application and determine the package that’s best suited to the candidate.
If you’re eager to get a loan at affordable interest rates, ensure you do your due diligence regarding the lender. Just as they do credit checks to ensure you’re a good partner with whom to enter into a financial agreement, it’s important to do your homework as well.