to Ask When Getting a Loan
When you’re thinking about getting a loan there are a few questions you need to ask yourself. Here are the top 5 questions you will need to ask before getting a loan:
What is my credit score?
You should consider this factor before applying for a loan, since it will affect your ability to get credit and how much it costs you in the long run. If your credit score is low, you should consider trying to raise it before applying for a personal loan. You can raise your credit score by paying down debt, removing incorrect information from your credit report, and making on-time payments.
Is this a secured loan?
For some loans, you need to put up collateral. This means you pledge assets to guarantee the loan, and if you default, the bank can seize those assets. Mortgage loans and car loans are secured loans. Secured credit cards in which you put cash into an account and then have a credit limit equal to that amount of cash are also secured loans. Most personal loans are not secured loans, but it’s still a good idea to ask to be sure.
What is the loan application process?
This is an important question because you need to know how long it will take for you to be approved for the loan, what you need to do to get approved, and how long it will take before the bank pays you the money you are borrowing.
What do I need to get the loan?
For some loans, supplying your credit score and stating your income is enough. Sometimes, however, you will need to bring tax returns or copies of bank statements so that you can prove how much money you make and how many assets you have.
What is the application fee?
You may need to pay a fee to apply or originate the loan. It is important to know this up front so you can compare different loans from different lenders to find the best deal and so you can be prepared to make the payment when the time comes.