The Cheapest Consolidation Loan May Not Always Be the Best by:Paul Rogers
As you conduct your research to find the cheapest consolidation loan
, be certain to look at all of the factors while doing so. It's important to look at the big picture and not just the fact that the interest rate is lower than other financial institutions you have researched. Perhaps there is a reason they have the lowest rate such as hidden costs they fail to disclose until time to sign the contract.
Know what questions to ask
Besides finding out what interest rate you will be paying on the loan, you must know what to ask the lender in order to assure that you are getting the cheapest loan. The price of a loan goes beyond the interest rate alone, and if you don't know what to ask, you may find yourself quite upset when the time comes to close the loan, and it isn't what you expected. Some of the things you may want to ask the lender prior to the closing of the loan are:
Is there an application fee?
Do you charge to record the receipt of collateral?
Do you offer life and disability insurance on the loan? Am I required to accept it?
What is the maximum repayment period?
Is there a fee for prepayment?
Are there any contingencies attached to the approval of the loan?
By asking these questions before the time you close the loan, you will save yourself any surprises. The last thing you want to do is show up to sign the contract and find out that there are contingencies or other fees connected to the loan. By the time you are ready to sign the contract, you will more than likely just accept whatever the lender offers because you don't want to begin the process of researching for another lender at this late stage of finding the cheapest consolidation loan.
Being certain you are getting honest answers
Is there a way to know if you are really getting the cheapest loan? Is the lender giving you the correct answers to your questions? Sometimes it is difficult to know if you are receiving accurate information, but one of the best ways to find out is to ask others who have dealt with the lender. This doesn't mean the lender is going to give you a list of customers, because by law he cannot do that; however, that does not preclude you asking people you know have dealt with the lender what their experience was. You can also contact the agencies that handle complaints about businesses and see if they have a file on the lender you are considering. The lender should also be willing to show you a copy of the contract they use and allow you to see something in the way of figure so that you know what to expect form yours.
Summing it up
When you are ready to close your loan, there should be no questions that you didn't ask or that the lender didn't answer. You should be certain by this time that you are getting the cheapest consolidation loan, and that the terms you are getting are ones with which you can live. If you ask the right questions and do research before you sign the contract, you can be sure that you have chosen the lender with the cheapest consolidation rate.
About the author
Paul Rogers writes general finance and loan articles for the Loans UK Online website at
http://www.loansukonline.co.ukhttp://www.articlecity.com/articles/business_and_finance/article_9506.shtml
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