It’s always best to get quotes from a few lenders before applying for a personal loan so you can determine which has the best overall offerings for your situation. When comparing lenders, keep an eye on the following factors.
1: Approval requirements. Every lender has its own threshold for approving potential borrowers, considering things like your income, credit score and debt-to-income ratio. If you have below-average credit, look for lenders that utilize other approval criteria; some will take into account things like your area of study or job history.
2: Interest rates. The lowest advertised rate is never guaranteed, so compare your actual quotes. When comparing interest rates, also make sure to incorporate any fees or penalties; origination fees or application fees can significantly add to the overall cost of your loan.
3: Loan amounts. If you need a loan for something small, like a minor car repair, you’ll look at different lenders than you would if you need to pay for tens of thousands of dollars in medical bills.
4: Repayment options. A good personal loan lender usually offers multiple repayment terms so you can choose the one that makes the most sense for your situation. If you’re borrowing a lot of money, you may want to look for a lender with long repayment terms to decrease your monthly payment. If you have a smaller loan, a shorter repayment term will cut back on the amount of interest you pay overall.
5: Unique features. Keep an eye out for lenders with any unique perks (or restrictions). Be sure to check that any lender you’re considering will allow you to use your loan for the purpose you’re intending. Some, like Payoff, restrict their personal loans to specific uses, like debt consolidation.
6: Customer service. It’s also wise to investigate a company’s customer service options, particularly if you prefer in-person service to online. If you need more information, you can always look up reviews about the company or check out its Better Business Bureau profile.