Life is full of goals to be met and unforeseen events to be resolved. On the one hand, you have to plan and set goals to meet your goals and on the other, you must be prepared for an out-of-the-ordinary event that can unbalance your financial health and make you go through a hurry. For both cases, you can ask for a loan.
This financial tool will give you support when you need it, but you must make sure you use this financing correctly so that you do not have problems, so learn how to manage your money.
Tips to ask for a loan and take it to perfection
A loan is granted after analyzing your ability to pay, but you must return the total of the money that was lent to you plus the interest that has accumulated during the time that your financing lasted and that were agreed at the beginning of the established term.
Follow the following tips to bring them to perfection and build a good credit history:
Research and compare your alternatives
It’s not just about comparing the interest rate, you should also review the Total Annual Cost (CAT), which is the actual rate that includes interest and additional charges that a loan has, such as commissions, fees and insurance. It will also be very helpful to review the Total Cost of Credit (CTC), which is the full sum you will end up paying when considering all the extras.
Deliver the complete information the first time
This is one of the tips before asking for a loan to give agility to the process: you should deliver all the information they ask you from the first time, since any clarification can mean a delay in the process.
- Keep in mind that the information required will depend on the type of credit you are applying for. In some cases, you will have an invitation from your bank and you will be able to activate your financing with just a few clicks, such as with an Immediate Personal Loan..
Review the contract in detail
You have to review what you’re committing to and what the exceptions are.
- Check if there are penalties or extra charges, as well as if there is the possibility of paying your credit in advance.
By running simulations of your loan, you’ll be able to review how many payments you need to make, the amounts of each, and the dates committed. It will be possible for you to know the behavior of the credit and how much you will have paid when you finish.
- Online simulators will allow you to do this easily and give you an idea of how your loan development will work over time.
Check the products that may be linked
Sometimes the credits have accessories that can generate additional costs.
- Most of the time they are optional, but you must tell your executive that you do not want to have them.
Choose the right deadline according to your ability to pay
If you choose a long term to have lower monthly payments, you will end up paying more interest. Conversely, if it’s too short, the fees could require a lot of your resources each month.
- Calculate well how much you can really take care of to define this parameter and maintain an excellent credit history.
Don’t ask for more money than you need
One of the worst mistakes in the management of money, is to forget that everything that is requested has to be returned, therefore, it only requests what you require.
- The extra money will keep you longer in debt and with higher interest to pay.
Ask for your credit in national currency
This assures you the amount you must pay, since it will be an amount that you know and that will remain constant.
- Currency volatility could increase your debt over time.
Choose a rate type based on your profile
Variable rates may suit you, but they are risky in case there is an adjustment to half of the financing. If you want something safer, choose a fixed rate that will stay the same throughout the period, it will be easier for you to keep track of it and it will bring you more stability.
- Consider which one you feel most comfortable with and find the credit that offers you a competitive rate with those conditions.
It is very important to pay all the fees in the deadlines you have set.
- If you comply with the payment later, you may be penalized by applying commissions and more interest, which are usually higher than ordinary ones.
Before asking for your loan follow these recommendations and find the ideal financing to achieve your goals. Remember to be responsible and immediately set aside the amount of your fee from your monthly income.
The good management of personal loans or any other type of loan is the responsibility of both the recipient of the credit and the one who grants it. Good behavior on the part of both, ensure a healthy economy at the micro and macroeconomic level. That is why the importance of responsible lending. In this post we explain more about the concept and how you can make sure you have a good behavior for your own financial well-being.