Taking out a loan? Not so fast, there. Hopefully, you wouldn’t marry just anyone, and like marriage, loans are a serious commitment. You aren’t able walk away scot-free whenever you feel like it; it’s a legally binding contract.
True, your loan isn’t supposed to last a lifetime. But there’s still the risk of waking up a few months down the road and realizing you made a terrible mistake. Here are five things to remember as you try to choose a lender.
1. They should give you options.
Very few of us are experts at dealing with loans, mortgages, and the like. For the average person, it’s all a bit confusing. A good lender will alleviate this. They’ll tell you about various types of loans, and help you figure out which one suits your situation best.
A lender who refuses to explain something in simple terms is not your friend.
2. There are warning signs.
Did a lender offer you a much bigger loan than you expected? That’s actually not so good. Predatory lenders are known to catch people on the hook for more than they can ever hope to pay off. You also shouldn’t give them the time of day if there are a bunch of nonspecific fees, or if they advise you to fudge your financial status in order to qualify.
3. You need a point of contact.
This one is really easy. If you have to call a number and speak to whatever representative is available, it’s a no-go. You should be able to contact a certain department or person who can handle your questions. A good lender will never make you feel like some random stranger.
4. They’ll be sizing you up, too.
Of course lenders want to know your credit score. But in addition to that, they might look at your work history, what you currently owe, and more. And even though you’re looking for a loan, they prefer it when you already have cash, particularly if you’re trying to get a mortgage.
With other kinds of loans, they’re also attracted to people who want to pay it off faster. You’re always more likely to be approved for a loan that you’ll pay off in a year than one that’ll take five. Having collateral or other valuables that could be sold off should you fail to repay is also an area of interest for them.
5. Consumers know best.
Never take a lender’s word for it when they tell you they have everything you want and need. Learn from people who have borrowed from them before, and you’ll know once and for all if it’s too good to be true. In addition, if you head to LoanReviewHQ.com, you can see a list of specs as well as ratings.
When many people look into a loan, they’re focusing on how worthy – or unworthy – they think they will appear. While this does matter, it’s equally critical that your lender have attractive qualities, too. Make sure they demonstrate their expertise, that you can identify who you should be speaking to, and as always, read reviews and do your own research.