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Before going for a loan, it is imperative that you know exactly what your monthly repayment is going to be down to the last penny and how much money you will be paying back totally, at the end of the term.
Take time and care to compare loan products from different companies and calculate the Annual Percentage Rates (APR's) in different ways. Lenders often tend to quote monthly interest rates, which are always lower than the annual rate hence these can be misleading. Clarify the annual rate. Be wary of credit card loans, as they charge a much higher rate of interest than other loans.
Borrow only as much as you can afford to repay - It’s never been easier than now to borrow money. Lenders have no issues in offering you more money than you even asked for.
Pay off the loan as soon as possible - The longer you stretch the repayment, the more you end up paying as interest. So be sure to get it off your back in the shortest possible time even if it means you have to keep tight fist over your other expenses.
Payoff store cards and credit cards in full each month - The interest part apply to these as well.
Do not be attracted to free gifts - Don't let trivial things like a free gift affect the choice of you lender. Go instead for the reputation and terms offered.
Do not be pressured - Don't let yourself be pressurised into taking a loan. Buy yourself enough time to think over and go back after two or three days.
Read all the fine print and the terms and conditions thoroughly - Ensure that you are making a well-informed choice rather than an ignorant one, which you might regret later.
Be wary of invitations for debt consolidation - Apparently a simple solution, debt consolidation is something that will make you borrow more to get out of debt and you end up paying much more in the long run.
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