Why Might I Need a Loan?
There are many reasons as to why people might borrow money. The first of these is to ease cash flow and another common reason is to settle debt.
The most common reasons people borrow money is:
- Pay off debt
- Wedding expenses
- Child expenses
- Home and renovation expenses
- Unanticipated cash needs
What to Consider Before Applying for a Loan?
One of the top factors that you need to consider before you take a personal loan is the interest rate, as this will determine the overall cost of the loan.
Other factors that you need to look at are the features of the loan, the loan terms, the application process and other such things.
What you Should Borrow?
You should only borrow what you need. Another factor to consider is your ability to repay the loan and if you can do so comfortably.
How Long Should You Have The Loan?
Your monthly repayment amount is influenced by the repayment term that you choose. You will need to look at what you can afford so that you can balance the repayment amount with the length of the loan
A longer repayment term will lower your monthly premium but the total interest that you will pay is higher.
What are a Credit Report and a Credit Score?
A credit report is a record of your credit history that is provided by the banks and other financial institutions. A credit report will be used as a reference by a lender for a personal loan.
A credit score is the numerical version of the credit report at a certain time. It is created through the customer’s credit account information.
What is a Monthly Flat Rate?
This is how the monthly repayment that needs to be made is calculated.
What is the APR?
The APR is the annual percentage rate and is an index of borrowing cost and is calculated on a yearly basis.
What are the Other Costs in Borrowing Money?
There is a handling fee that is charged for processing a loan and is charged on a yearly basis.
If you decide to settle the loan earlier, you may have to pay an early repayment fee.
If you are late in making your monthly repayment then you are charged a late repayment fee.
What is a Personal Installment Loan?
A customer is able to pay the actual loan amount ads well as the interest with a monthly amount for a certain period of time that will equate to the total owed.
What is a Revolving Loan?
This loan gives customers a revolving line of credit that can be withdrawn from at anytime. There is no fixed monthly repayment amount or repayment period. Customers are able to pay the minimum required and interest will be charged on an outstanding balance.