Brought to you by
Save content
Have you found this content useful? Use the button above to save it to your profile.
maselkoo99

Key considerations for taking out a personal loan

28th Feb 2017
Brought to you by
Save content
Have you found this content useful? Use the button above to save it to your profile.

Personal Loans Factsheet - Check out these key considerations provided by Wesleyan Bank

1. Be aware you might not actually get the interest rate advertised with the loan, which is known as the representative APR (or annual percentage rate). This is the rate used in advertising or on banks’ websites, but not everyone will qualify for it. In fact, loan providers are only required to offer this rate to just over half (51%) of borrowers they lend to.

2. Look out for any arrangement fees, which will make a loan much more expensive. Make sure you include them when you work out how much the loan is going to cost you. Arrangement fees will be included in the APR – which is why you should compare APRs rather interest rates.

3. You can make over-payments or pay off a personal loan in full before the end of your agreement without penalty.

4.  Before you apply for a loan, check the small print to see if you’re eligible. Some best buys come with certain conditions, i.e. some banks may only offer their best loan rates to current account customers.

5. It might seem unlikely at the time when you take out a personal loan – but don’t forget that it’s possible you will be able to pay off your debt early. Many loan providers will apply a charge if you wish to do so, so it’s a good idea to check how much this might cost you before you make your decision.

6. If you plan to apply for a market leading personal loan, it’s crucial that you check your credit rating first. Lenders are only required to offer their advertised 'typical' APRs to two-thirds of applicants. Therefore, if your credit rating is not in good shape, you may be offered a more expensive deal than the low rate loan you originally applied for.

7. When you apply for a loan online, most applicants will leave a “footprint” on your credit record which lenders check before approving a loan. Having lots of applications on your record can make you appear more of a credit risk, so your latest loan application could be less likely to be approved.

8. You have a 14-day cooling-off period from either the date the loan agreement is signed or when you receive a copy of the agreement, whichever is later. If you cancel, you have up to 30 days to repay the capital and interest.

Wesleyan Bank is a specialist provider of personal loans to professionals like accountants. Our lending criteria is different to others as we take into consideration an individual’s professional status. So, whatever the reason you may have for taking out a personal loan Wesleyan can help.

To find out more please visit our website.

Tags: