Tips for finding the right lender
When shopping for a personal loan, there are a few essential things to consider. One of the most significant is where to get your loan. With so many lenders out there, doing your research matters. Here is a quick guide to the types of lenders offering personal loans and how to choose the right one for you.
You can apply for a loan with a bank even if you’re not a current account holder. Banks tend to offer higher loan amounts but favor borrowers with higher credit scores. If you already have an account with the bank, you could have an advantage when it comes to getting approved. You may also get a discount on the loan. You likely have to do some or all of the application and funding process in person.
To apply to a credit union, you have to be a member. The loan amounts are usually smaller, but interest rates may be, too. Your credit score can be lower than what a bank requires, but your approval odds may be better if you have a positive history with the institution. The credit union may require you to complete the application process in person at a branch.
These lenders make the application process convenient because you can do it all online anytime. Approval decisions are usually sent the same business day and you receive your loan funds within a couple of days, typically via direct deposit. You can prequalify and check your loan options without impacting your credit score (before actually choosing to apply). The fees may also be lower overall. However, you don’t get in-person customer service, and your interest rate could be on the higher end if you’ve had some credit challenges.
What else to consider
Still trying to decide which lender is best for you? One way to narrow down your choices is to make a list of each lender that could be a good fit. Then, write down the pros and cons of borrowing from them. Here are some things to keep in mind:
Purpose of loan (vehicle, big event, debt consolidation, etc.)
Interest rates (or APR)
Secured vs. unsecured loan
Funding options and speed
Fees (origination, pre-payment, etc.)
Benefits (autopay discounts, etc.)
Whichever lender you go with, borrow only the amount you need to limit the cost of the loan overall, and be sure you can afford to repay it. To figure out how much you could realistically work into your budget for monthly payments, use an online tool like a loan repayment calculator. Also, understand the terms before your sign your loan agreement (and don’t forget that fees will be a part of the total cost).
Find out if Lendmark is the right lender for you. Chat with one of our friendly loan experts or get started online.