How to Find a Good Lender? Top 5 Signs
The credit market is full of various offers. Each lender promises the best rates, the most extended repayment periods, and other bright prospects. And some of these creditors will keep their promises. And some will write fees for several hundred dollars into the loan agreement and pretend that nothing happened.
How to distinguish a good lender from a bad one - we have collected five key features.
1. Reasonable interest rates
The first thing we pay attention to when looking for loan offers is interest rates. This is logical and correct because it depends on them how much we pay for the use of money.
After spending five minutes on the Internet, you will have an idea of the average interest rates for the type of loan you are about to take out. This value should be taken into account when choosing a loan.
But do not forget to consider your credit history and income; perhaps your interest rate will be lower or higher.
You should beware not only of those lenders who offer high rates but also those whose rates are too low. Most likely, fees and fines are hidden behind them for literally everything.
2. Flexible terms
Of course, business is business. And each lender has the most beneficial loan type, including the terms of the loan. But a good lender will come into your position and help you find a loan repayment term that will not drive you into a debt hole and will not deprive you of most of your income.
Loan terms should be calculated considering your income, opportunities, and, of course, the amount you borrowed.
3. No collateral
This condition will not be relevant if you choose a mortgage or a home equity loan. However, all other loans that require collateral are not something you should pay attention to. Of course, in the absence of different options, the borrowers can take such a step, risking their property, but a good credit rating and income are enough for a good lender to provide access to money.
4. Fees and penalties
It may be challenging to find a loan without any fees. But if a lender asks you to pay loan origination fees, application fees, this is not the lender you need.
Of course, you can hardly find a lender who imposes late payment fees. However, a good lender will not require you to pay prepayment penalties.
This is probably the easiest thing to do. If you have chosen a lender and it seems to you that everything is going well - spend some of your time and read reviews about it. Do not forget to each his own way; some people just like to write bad reviews, regardless of how the service was provided. Nevertheless, it is quite possible to form an opinion on the basis of the majority.
At first glance, it may seem that it is impossible to collect all the above points in one lender. And perhaps you decide to give up on one thing in order to win on something else. However, it is normal and proper to look for compromises.
However, a thorough search may still lead you to a lender that offers a reasonable interest rate, no extra fees or penalties, no collateral required, and good reviews of their work.