Comparing loans from different lenders can be tedious and difficult. Closing costs and interest rates will vary from one lender to another. Some lenders will have lower rates, but the personal loans they offer are high in terms of fees. This can be such a disadvantage primarily because most people take personal loans to reduce the interest they have to pay on the debt. Personal installment loans simplify the process of repaying your debt.
So, if you are thinking about personal loan shopping, it is essential for you to compare all the available options carefully. This guide will help do exactly that.
What to consider when comparing loan offers from different lenders
Application process
If timeliness and convenience are important to you, the ease of applying for a personal loan is one of the first factors to consider when you compare loans. It is now possible to get personal loan online, ensuring your personal loan lenders search stops here. When applying online, try to eliminate lenders who need an in-person visit.
If a speedy approval matters, make sure you avoid applying for quick cash loans from lenders with an extended timeline required for approving loans. Almost all lenders provide their clients with a rough estimate of how long the approval process takes. You can use this information to decide, which lender has a speedy approval process.
Credit score
When you shop personal loans, one of the factors that lenders use to approve your loan is your credit score. This is a significant determinant, as it speaks about your ability to repay debt. The higher the credit score, the better. To approve personal loans, most lenders require loan applicants to have a score of at least 600. Therefore, when comparing loans, try to find out the lenders minimum credit score. This will help you avoid lenders who are most likely to turn your loan request down because of your credit score.
Annual percentage rates
The cost of borrowing a personal loan is one of the essential factors you need to consider when determining which lender to ask for a loan. One way you can compare the cost of borrowing from different lenders is by looking at the annual percentage rates each lender offers. An annual percentage rate is the total interest rate a loan accumulates over a year. The lower the annual percentage rate, the less the loan will cost you.
Repayment terms
One of the reasons why most people take loans is to help make their debt repayment simple. While having personal installment loans is convenient, you, however, do not want to spend additional money and time repaying a personal loan. A longer loan repayment period means that you will end up paying even more in total interest. While a shorter loan repayment period means that you will pay off your debt sooner and the interest cost is lower.
It is also essential for you to find out whether the short term loan lender has prepayment penalties for repaying the loan earlier. If you hope to pay your loan earlier, it is essential to ensure you do not get penalized for paying your personal loan earlier.
Origination fees
Personal loan lenders tend to charge origination fees for loans they approve. The fee they charge can be as low as 1% and high as 6%. High origination fees add to the total amount of borrowing, therefore, make sure you look for a lender that offers no origination or low costs.
It is essential for you to take your time comparing lenders when personal loan shopping. OLA (Online Lenders Alliance) can help you check out the information you need for different lenders, as well as give you the protection you require once you decide to take that personal loan. Your personal loan lenders search ends here as OLA gives you the information you require.