When and How to Apply for a Loan
Written by: John Mussi
If you're in the market for a loan, you might be wondering
exactly how you're supposed to figure out what you're looking
for and which loan you should apply for. There are so many
sources of loans, and many types of lenders. Here are a few
common sources of loans:
Commercial Banks - Commercial banks make loans mostly for
commercial ventures and small businesses. Smaller loans,
especially if you're a long-time customer, are also available.
Credit Unions - Credit Unions offer fewer fees and lower
interest rates, but are only available through affiliated
Government Agencies - Both the US and the UK offer special loans
for investments, low income, or many other special standards.
These rates are often locked in, and always reliable.
Online Lenders - Very often low cost options are available to
online consumers in order for online lenders to be competitive.
Consumers may benefit from these loans due to the increased
efficiency of online lending. Most communications can be sent
via email for added convenience.
What to Do Before You Apply for a Loan
Clean up your credit report.
Be sure to clear up any credit problems before you apply for a
loan. If any problems turn up later, a lender won't want to hear
your explanations. You can get help on cleaning up your report.
Provide all the requested information quickly.
If the loan officer asks you for a pay stub, get the pay stub as
quickly as possible. Holding up the process never goes well, and
can even cost you the loan if the lender fears that you'll be as
slow to make your payments. Try to have as much information
available for the lender as possible so as to speed up the loan
Keep in Touch
Call your loan officer periodically to check on the progress of
your loan processing. If there are any problems, you'll want to
know immediate. You should always make sure that you are not
responsible for holding up your own loan.
Don't Make Any Big Purchases
If you go out and buy a new car right before you apply for a
loan, that debt is going to appear on your record. If you buy
this car after you apply then the debt my also show up because
some lenders run two credit checks: one when you apply and one
just before closing. So if you're contemplating a big purchase,
wait until after your loan is closed.
How to Apply for a Loan
Applying for a loan is as easy as filling out a form and talking
to your lender. First, though, you'll need a little information
about yourself. Exactly what you'll need depends on the type of
loan you're seeking and where you're applying. Here are a few
examples, but be sure to check with your lender to make sure you
have all your information available.
Most Loans Will Require:
Name and phone number of nearest relative not living with you
Length of time at your current address, and monthly
mortgage/rent payment amount
Employer name, address and phone number (if applicable)
Length of employment (if applicable)
Amount of yearly salary
Any other annual income that should be considered
Other loans may also require information about your vehicle or
home, a Lease, Franchise Agreement, Purchase Agreement, Letters
of Intent, Plans, Copies of Licenses, or Letters of Reference.
Regardless, you should always be sure to consult your lender as
much as possible to be sure you're getting the best loan
possible for your circumstances.
You may freely reprint this article provided the following
author's biography (including the live URL link) remains intact:
About the author:
John Mussi is the founder of Direct Online Loans who help
homeowners find the best available loans via the www.directonlineloans.
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