Finance Resources You Can TrustFinance Resources You Can Trust
  • Home
  • Personal Loans
  • Insurance
  • Mortgages
  • Student Loans
  • Credit Cards
  • Investing
  • Taxes
  • Small Business
What's Hot

9 Consequences of a Bad Credit Score

July 7, 2022

7 credit card perks you might be missing out on

July 7, 2022

These 7 Credit Score Landmines are Hurting Your Credit

July 6, 2022
Facebook Twitter Instagram
Finance Resources You Can Trust Finance Resources You Can Trust
Facebook Twitter Instagram
Subscribe
  • Home
  • Personal Loans

    Step By Step Guide on how to apply for a personal loan with best rates

    June 26, 2022

    LightStream Personal Loans Review – Read This Free 2022 Guide Before Applying

    December 31, 2021

    Upstart Personal Loans Review – Is it for you?

    December 29, 2021

    Avant Personal Loans Review 2022 – A Free Guide On How To Get Approved

    December 23, 2021

    LendingClub loans Review

    December 23, 2021
  • Insurance

    A Comprehensive Guide To Small Business Insurance

    December 22, 2021

    All You Need To Know About Horse Insurance

    December 22, 2021

    7 Significant Differences Between Petplan and Pet Insurance

    December 11, 2021

    Advantages and Disadvantages of Pet Insurance

    December 1, 2021

    Types of Life insurance in the US

    November 29, 2021
  • Mortgages

    What are FHA Loans and what do you need to know about them?

    November 17, 2021

    Mortgage Refinance – A Complete Guide

    November 17, 2021

    What are mortgages, and how do they work?

    November 17, 2021

    How do mortgages work in the USA? A complete guide on US mortgages.

    November 15, 2021

    Everything You Need to Know About Home Equity Line of Credit

    November 13, 2021
  • Student Loans

    Everything You Need to Know About Student Loan Consolidation

    June 24, 2022

    8 Ways to manage student debt after graduation

    June 24, 2022

    What to know about unsubsidized student loans before applying.

    October 21, 2021

    Federal Student Aid. All you need to know about them.

    October 19, 2021

    Student Loans Deferred? What you need to know about deferment.

    October 18, 2021
  • Credit Cards

    7 credit card perks you might be missing out on

    July 7, 2022

    5 Credit Card Myths You Need to Stop Believing

    June 29, 2022

    Credit Cards 101: Get Insights On How They Work

    June 24, 2022

    Secured Credit Cards 101: How They Work and Why You Should Get One

    June 24, 2022

    5 Ways to Avoid Getting Buried in Credit Card Debt

    June 17, 2022
  • Investing

    A Free Guide To 1031 Exchange: What You Need to Know

    June 28, 2022

    What you need to know about high risk investments

    January 2, 2022

    A Complete Guide On The Stock Market: What you should know.

    January 2, 2022

    Why is investing better than Savings? See The Six Reason Why.

    January 1, 2022

    Advantages and Disadvantages of Investing

    January 1, 2022
  • Taxes

    9 Tips on how to choose the right Tax Preparation Attorney

    June 24, 2022

    A comprehensive Guide to HR block online

    June 19, 2022

    The Top 7 Benefits of Hiring a Tax Preparation Accountant

    June 19, 2022

    Everything You Need to Know About Certified Public Accountants

    June 18, 2022

    Everything You Need to Know About Free Online Tax Filing

    June 16, 2022
  • Small Business

    A Comprehensive Guide To Small Business Insurance

    December 22, 2021

    A Detailed Guide On SBA Disaster Loan

    December 8, 2021

    SBA 7a Loan: A Free 2022 Guide On What To Know About It

    December 8, 2021

    Difference Between SBA 504 and SBA 7(a) Loan

    December 8, 2021

    How to Get A Startup Business Loan Without Collateral

    December 8, 2021
Finance Resources You Can TrustFinance Resources You Can Trust
Home»Personal Loans»Step By Step Guide on how to apply for a personal loan with best rates
Personal Loans

Step By Step Guide on how to apply for a personal loan with best rates

Biz GeldBy Biz GeldJune 26, 2022Updated:July 1, 2022No Comments5 Mins Read
Facebook Twitter LinkedIn Telegram Pinterest Tumblr Reddit WhatsApp Email
Step By Step Guide on how to apply for a personal loan with best rates
Share
Facebook Twitter LinkedIn Pinterest Email

When you’re in need of money for a large purchase or unexpected expense, you may be considering a personal loan. Private loans are a type of installment loan, which means you borrow a certain amount of money and then make fixed payments over a set period.

If you have good credit, you may be able to qualify for a low-interest private loan from a credit union, bank, or online lender. If you have fair or bad credit, you could still be able to get a loan, but you’ll likely pay a higher interest rate.

Here’s a step-by-step guide on how to apply for a personal loan to help you compare personal loans and find the best one for your needs.

1. Check Your Credit Score

Your credit score is vital in determining whether you’ll qualify for a loan and, if so, what interest rate the lender will offer you. A higher score indicates to lenders that you’re a lower-risk borrower, which could lead to a lower interest rate on your loan.

If you don’t know your credit score, you can get a free credit report from each of the three major credit bureaus – Experian, Equifax, and TransUnion – once a year at AnnualCreditReport.com.

>> See how you can check your credit report in 3 simple steps.

2. Decide How Much You Need to Borrow

Before you start shopping for a personal loan, you must know how much money you need to borrow. The amount you’re eligible to borrow will be based on factors like your credit score, income, and debts.

If you need help calculating how much you can afford to borrow, consider using a personal loan calculator. This tool can estimate your monthly payments and the total cost of the loan based on the interest rate and loan term you enter.

3. Shop Around for the Best Personal Loan

Once you know how much you need to borrow and your credit score, you can start shopping around for personal loans. You can consider a few different types of lenders, including banks, credit unions, and online lenders.

If you’re considering a bank, start by checking with your primary bank or credit union to see if they offer personal loans and their terms. If you don’t have a relationship with a bank or credit union, you can compare personal loans from various online lenders.

When you’re comparing loans, be sure to look at the annual percentage rate (APR). The APR includes the interest rate plus any fees charged by the lender. Your APR is the actual cost of the loan, so it’s essential to compare APRs when shopping around.

4. Read the Fine Print

Once you’ve found a personal loan with terms that work for you, it’s essential to read the fine print before applying. Some personal loans come with origination fees, which the lender charges for processing the loan.

Origination fees can range from 1% to 8% of the loan amount, so be sure to factor this into your decision. You may also want to consider a personal loan with no origination fee, even if it has a slightly higher interest rate.

5. Apply for the Loan

When you’re ready to apply for a personal loan, you’ll need to provide personal and financial information to the lender. This information may include your name, address, Social Security number, and income report (often your payslip or bank statement).

The lender might ask you to provide information about your debts, including credit card balances and other loans you’re currently paying off. The lender will use this information to decide whether you qualify for the loan and, if so, how much they’re willing to lend you.

6. Expect a Hard Inquiry on Your Credit Report

When you apply for a personal loan, the lender will likely make a hard inquiry on your credit report. This inquiry can temporarily lower your credit score by a few points.

However, if you have a good credit history, the impact of a hard inquiry is typically minimal, and your score will rebound soon after. If you have bad credit, a hard inquiry may not impact you since your score is already low.

7. Get Your Money

If the lender approves your application, they will send the money to your bank account within a few days. Once you have the money, you can use it for any purpose you need.

Just be sure to make your loan payments on time. If you miss a payment, your lender might charge you a late fee. More importantly, the lender might report your late payments to the credit bureaus, damaging your credit score.

8. Pay Off Your Loan

Personal loans typically have terms of three to five years. This means you’ll have a set repayment schedule, with fixed monthly payments, for the life of the loan.

When making your monthly payments, remember that a portion of each payment will go towards the interest, and the rest will go towards the principal or the amount you borrowed.

If you have a personal loan with a variable interest rate, your monthly payments may go up or down, depending on changes in the market. However, your monthly payments will never go below the minimum payment amount.

Bottom Line

Hopefully, it’s clear what the key steps to take when applying for a personal loan are. The next step is to actually do it! Gather all of your information and get started with your application process. We hope this guide will help you get started.

Another quick tip when applying: If you want to get the best rates on your loan, make sure your application is as complete and as accurate as possible. A detailed and honest application shows the lender that you are serious about borrowing money and will help them in making an informed decision about whether or not to lend you the money

Share. Facebook Twitter Pinterest LinkedIn Tumblr Telegram Email
Previous Article10 Simple Ways On How To Improve Your Credit Score
Next Article 7 Amazing Benefits Of Having A Good Credit Score: Do you know them?
Biz Geld
  • Website

BizGeld provides well-researched and free finance educational content to help you make informed financial decisions. Although we provide unbiased information and recommendations, we are not your typical financial advisor. So before making any financial decision, please contact a professional.

Related Posts

LightStream Personal Loans Review – Read This Free 2022 Guide Before Applying

December 31, 2021

Upstart Personal Loans Review – Is it for you?

December 29, 2021

Avant Personal Loans Review 2022 – A Free Guide On How To Get Approved

December 23, 2021
Add A Comment

Comments are closed.

About BizGeld
About BizGeld

Discover, save and make sense of anything to do with finance - from how to start a business, invest in property, find the best credit card, and much more.

Facebook Pinterest

Disclaimer: BizGeld strives to keep its information as accurate as possible and up to date. The information we share might be slightly different from that of a financial institution, service provider, or specific product site. All financial products, shopping products, and services are presented without warranty. When you are evaluating offers, please review the financial institution’s Terms and Conditions. Pre-qualified offers are non-binding. If you find discrepancies with your credit score or information from your credit report, please contact TransUnion® directly.

We're social. Connect with us:

Facebook Twitter Instagram Pinterest YouTube
Latest Resource

9 Consequences of a Bad Credit Score

July 7, 2022

7 credit card perks you might be missing out on

July 7, 2022

These 7 Credit Score Landmines are Hurting Your Credit

July 6, 2022
Get Informed

Subscribe to Updates

Get the latest creative news from FooBar about art, design and business.

© 2023 Bizgeld. Privacy Policy | Prequalification Terms | Terms of Use |

Type above and press Enter to search. Press Esc to cancel.