Personal loans come in handy, be it to pay for a vacation, debt consolidation, medical emergency, buying expensive home appliances, home renovation, to name a few. Many of these loans are often unsecured, so you don’t necessarily need to have collateral to offer as security making them ideal for borrowers with a low credit score.
This addition to being a lot quicker to be granted has increased their appeal among many people in need of money.
However, don’t get excited just yet because there’s one crucial thing you need to do before taking out a personal loan, and this is getting a reliable lender. This way, you’re guaranteed guidance the entire time you’ll have the loan.
But finding a trustworthy personal loan isn’t straightforward and involves a lot of work. Here are four things to look for in a personal loan company to ease your troubles.
Credibility And Experience
Because money is involved, you want a personal loan company that you can trust to start any dealings with them. This is why one of the first things you need to check when looking for a personal loan company is its credibility.
While there are different ways that you can use to gauge the lender’s reliability with varying levels of accuracy, the best one is, without a doubt, searching on Google to read the company’s online reviews and testimonials from their previous clients.
Therefore, you should go through as many reviews to learn both the positive and negative things about the company. This way, you’ll get a broader and clearer picture of the personal loan’s company credibility.
You can also browse through the lender’s social media channels and website to check out their customer’s comments and whether they’re satisfied with the quality of their services. In addition, you can ask your friends, colleagues, or family who’ve worked with the lender for further clarification on their reliability.
Life is filled with surprises, and you shouldn’t assume that you might find yourself struggling to pay off your loan repayment. When this happens, you might end up paying substantial fines for delayed payments.
This is the last thing you want when you’re already struggling financially. Therefore, you want to choose a personal loan company that offers you flexibility in your payment schedule.
The lender’s flexible loan repayment terms shouldn’t only apply for delayed payments but also if you want to pay off your loan sooner than earlier anticipated. This is essential because some personal loan lenders charge you additional fees for increasing your equated monthly installments (EMIs).
Examine The Cost of The Loan
Another thing that’ll undoubtedly determine the personal loan company you’ll choose is their interest rates. After all, you don’t want the cost of the loan to surpass a certain limit. Therefore, you should search for a personal loan lender that provides you with a lower interest rate, which means your final payment will be much lower.
With that said, you need to remember that the interest rate you get is usually linked to the kind of loan you’re taking out and your credit history.
Besides the interest rates, you also need to check out the personal loan company’s fees, such as service charges, processing fees, loan cancellation fees, origination fees, and administration fees.
Understanding all these charges when taking out a personal loan ensures you don’t pay more money than what you’re ready to spend.
You want to work with a lender who quickly processes your loan request, ideally within 72 hours after the request. This can be achieved if the loan company doesn’t demand many documents and has many unnecessary steps to the loan request process. Instead, they should only require relevant paperwork such as;
- Your income slips for the previous three months
- Documents showing proof of identity and your address
- Your bank statements for the last three months
This is crucial because you most likely need the personal loan for an emergency that needs to be attended to right away. Therefore, you should ask the lender how long they’ll take to process your loan to know whether their timeline is acceptable or to opt for another lender.
The lender’s response time also applies to how quickly their customer representatives attend to any issue you might have. This is especially critical because customer support is an integral pillar of any financial relationship.
Because of this, you want a personal loan company that’s always easily reachable to answer all your queries and questions.