Getting a loan can often save the day or help you take advantage of a new opportunity, especially when you are looking for finances for a particular time frame. The process can be complicated or lengthy because of the many requirements that might be needed.
“If it is your first time to acquire a loan, whether business or personal loan, it is important to know what is expected of you so that you can do them ahead of time.” says Mr. Bukenya Rogers, Relationship Manager at ABC Capital Bank.
It is imperative to be thoughtful about how you apply for a loan to cover up or clear a specific need. Here are some quick tips to consider before getting a loan;
1.Understand the length of your Loan
Depending upon the type of loan you need, the length of the loan will also play a part in determining your total loan cost. Since different loans are set up in different ways, and since there are so many loan lengths, it is best to discuss your options with a bank loan officer.
Here at ABC Capital Bank our loan officers are swift in making sure you fully understand your loan needs and requirements.
2. Read the fine print to details
When you walk-in the banking hall, be sure to ask for a full disclosure of all the loan terms and conditions, read the fine print carefully. You must know that each loan comes with its own terms and conditions.
Understand your monthly repayment terms and if they work for you. Please ask if there are any fees for late payments.
As a bank, the business is to generate a steady stream of interest payments from your borrowing over the loan term. There could also be a prepayment fee, or penalty for paying off your loan early.
3. Always ask the WHAT IF questions – in case you encounter difficulties with repayments?
When discussing with a loan officer, find out what your options are in case you run into difficulties making your repayments. Is there any potential to modify the terms of the loan?
Also, is the bank open only to arbitration if any differences arise? Or can you go through the court system?
4. Don’t borrow more than you can afford
Before you apply for a personal loan, gauge your financial situation and how much you can comfortably take on. Anything more will strain your finances and eventually run into problems of failing to make your payment on time thus defaulting.
When with loan expert be honest as much as possible with your financial abilities.
5. Don’t apply for too many loans
When you apply for a loan, a “footprint” is left on your credit record which lenders check before approving a loan.
Having a lot of loan applications on your record makes you look desperate or in financial difficulties. As a result lenders will see you as a credit risk, so your latest loan application is less likely to be approved.