MissDomestic.com

By Peter Kenny

Are you thinking of taking out a personal loan! If the answer is yes then you have to ask yourself some questions first. This will make sure that the loan you choose is the right one to suit your needs.

Below are some of the most common questions you should be asking.

Do I really need a personal loan?

You have to ask yourself if the purchase you are about to buy is necessarily, as you may have this debt for a year or two.

Can I afford to takeout a personal loan?

This is properly the most important question you will have to ask yourself, debt advisers says that a non- mortgage monthly repayment debt should not be anymore than 5% of your net income. This is the total you walkout with after tax, say you take home £2000 a month then the most you should be paying back is about a £100 a month.

How much should I borrow?

Most lenders offer a cheaper APR on a larger loan; each lender has their different levels of interest rates and will change them with accordance to how much you borrow. Sometimes it’s best to up your loan just a small bit to get the best interest rate.
For example maybe you only want a loan of £4.500 your APR maybe 10.5% but if you go for a £5,000 loan the APR drops to 9.6%. So over all you may end up saving by taking out a bit more just something to watch out for.

Where do I go for a personal loan?

Most people think of the bank first nothing wrong with that, but know there are so many places to look. Everywhere you turn you see adverts for loans including the newspapers, TV, mail, supermarkets and the Internet. The competition at the moment from the lenders is great; they all want your business so there are some great deals on offer. You just have to look for them take your time and you are sure to get the best deal around

Will I be covered if I become ill or unemployed?
Most lenders will have PPI (payment protection Insurance) please check the policy carefully and ask questions. As not all these policies will cover you and they can be expensive, sometime it’s best to shop around for a different policy.

Can I pay my loan off early?

Yes you can and unbelievably 60% of people do, again check with your lender as some add on penalties for paying off your loan early. Some lenders charge two or three months interest unbelievable but true.

What happens if I get turned down for a loan?

First check why is it because your credit rating is poor or is it because you’re asking for too much money. If your income is low you may be asking for too much, if this is the case reduce your request. If it’s poor credit rating check out why and try and sort that out first, before you reapply
Hopefully these answers will help you, just remember workout what you need the loan for first, then make sure you can afford to make the repayments. Take your time when looking for your personal loan, as there are some great deals out there at the moment.

Peter Kenny is a writer for creditcards-gb

For additional articles and an extensive resource for everything about credit cards, please visit us at http://www.creditcards-gb.co.uk and http://www.creditcards2go4.com

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By Peter Kenny

If you are thinking about getting a loan, then you should know about the basics before you get started. If you understand the basic dos and don’ts of loans, then you will be better equipped to find the best loan for your needs. Whatever type of loan you are applying for, you should follow these basic rules to help you find the best deal:

Shop around

When searching for a loan, it pays to do your research. Look for as many suitable lenders as you can, so that you can find the very best deal. There are many online pages that allow you to compare loan rates from a variety of lenders. As well as looking online, check out your high street banks and mortgage lenders for deals too. However, remember that if you ask for a detailed quote, the lender will have to look at your credit report. Too many lenders looking at your credit report can affect its rating, so make general enquiries until you are sure the lender is right for you.

Look beyond APR

When shopping for a loan, you should look past the promotional APR rates and terms, and ask the lender what the monthly repayments are. Low APR rates are good, but you need to find out what rate you can actually receive, what the repayment terms will be and if there are any additional charges. Think about the total interest payments on the loan rather than just the monthly payments.

Look at protection

When taking out any loan, it pays to have protection in place in case you fall ill or become unemployed. Look at the cost of taking out such cover, both with the lender and with other companies. Also make sure that you need all items of cover, as some of the items such as sickness or accidents may be covered by your current employer.

Avoid using collateral

If possible, try and avoid taking out secured loans. If the amount you need to borrow is small or you have good enough credit to borrow without collateral, then do so. Although unsecured loans have higher rates, they are less risky because your home will not be at risk if you cannot make the payments.

Check and double-check

Before signing any agreements, check and double-check all of the terms and small print. Some lenders will put the most unfavourable clauses in the agreement in a place you might overlook. Look at what happens if you miss payment or the payment is late, and if there are any additional penalties or charges, such as charges for early repayment.

Get short terms

Try and take a loan out over the shortest period you can afford. Taking loans out over 10 years or more can be risky, and you cannot be sure what your financial situation will be at that time. Of course, taking out a long-term loan for property is acceptable, but is it something you really want to do just to buy a car or pay for a marriage? The longer the period of the loan, the more you have to pay back.

Whatever type of loan you want to get out, make sure that you know you can afford to make the repayments, and that taking out the loan will help you financially.

For additional articles and an extensive resource for everything about credit cards, please visit us at Credit Card and Personal Loans
Visit http://www.creditcards-gb.co.uk

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