By: Raymond James
When applying for a loan, you might be worried about whether your credit score and other factors will make it harder to get approved. But once you’re armed with the knowledge of what lenders look for and how to present yourself, it becomes much easier.
In fact, getting a good deal on loans is fairly simple when you know what angles to play. When it comes to loan applications, there are lots of ways to increase your chances of being approved while also reducing the amount you have to pay back.
Here are some great resources and tips that will help you get a good deal on loans.
Have a solid plan for the money you’re borrowing
Before you even think about applying for a loan, make sure you have a clear plan for how you’re going to use that money.
First of all, make sure you have a solid plan for repaying the loan. A lot of people get into financial trouble because they use loans to cover a gap they can’t afford.
If you’re considering a loan to cover an unexpected expense, make sure you can cover the repayments comfortably. Make sure your plan for repaying the loan takes your regular financial obligations into account as well.
Have a long-term plan for what you’ll do with the money you’re borrowing
Before you apply for a loan, make sure you have a plan for how you’re going to use that money. If you don’t have a clear plan for your spending, a lender might worry that you’ll blow through the money too quickly.
This is especially important if you’re applying for a larger loan amount, like a small business loan. Lenders want to make sure you have a solid plan for how you’re going to use the money and that you can repay the loan.
Check your loan options during your research phase
Once you know what type of loan you want, it’s time to start researching lenders and loan options. At this point, you want to make sure you’re using the right lenders and that you know what options are available to you.
Lenders differ in lots of ways, including the interest rates they use and the types of loans they offer. Some lenders specialize in certain types of loans, while others offer a variety of loan types.
Make sure you’re applying to the right kind of lender to suit your needs. If you want, you can enquire with several lenders at once but make sure that you don’t overdo and end up with too many inquiries on your credit file.
To avoid this, you can ask at which point the lender performs a credit check, so you can get the information you need.
Negotiate any fees and interest rates ahead of time
Before you sign the dotted line on any loan, it’s a good idea to negotiate any fees and interest rates. There are two parts you’ll want to focus on here. First, try to negotiate any fees that are associated with the loan.
This could include lender fees, application fees, or any other fees associated with applying for the loan.
You can negotiate these fees by asking if the lender offers any discounts or fee reductions. If you’re applying for a large loan or for a commercial loan, the lender might be more willing to negotiate fees. Secondly, try to negotiate the interest rate on the loan.
The interest rate is the amount you’ll have to pay and is based on your credit score. If you have a high credit score, you might be able to get a lower interest rate on the loan. If you have a low credit score, you might get a higher interest rate.
Getting a good deal on loans is all about knowing what lenders are looking for and how to present yourself to get the best deal possible. At the end of the day, lenders want to make money, and they want to lend money to people who will pay it back.
That’s why it’s important to put your best foot forward when applying for a loan. Having a clear plan for how you’re going to use the money and having a solid plan to pay it back will make it easier to get the loan you want.
About the Author
Ray is a sought-after thought leader and an expert in financial and money management.
He has been published and featured on over 50 leading sites and aims to contribute articles to help novice financial planners. One of his goals is to impart his knowledge in finance to educate and help ordinary people create and achieve their financial goals.