img
img
MyMoneyHelp.co.uk
Sign up for our newsletter!
Name:
Email:

MyMoneyHelp
Credit Reports
Personal Loans
Mortgages
Insurance
Debt Help
Credit Cards
Banking
Utilities
Mobiles
Broadband
Education
Education
Banking
Credit Cards
Debt Help
Insurance
Mortgages
Loans
Credit Reports
Broadband
Investments
Pensions
Mobiles
Utilities
Glossary
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Compare loans
Compare Loans:
Advice on Shopping for Loans

Loans come in all shapes and sizes. With so many loan offers coming at you from all directions, choosing the right one can be difficult. However, if you are prepared do some careful homework, you will be able to compare loans, and find a loan that is perfect for your needs.

As long as you have a reasonably good credit record, securing a loan nowadays is a relatively trouble-free process which can be completed quickly over the telephone or online while you compare loans.

Finding a loan

The traditional route to finding a loan is through a bank or building society. However, there are now many good deals to be found through non-traditional routes such as large supermarkets. Generally speaking, you can get a better deal through an online specialist loan provider, but this depends on your requirements when you compare loans

Some borrowers prefer using the services of a broker. Most brokers claim to help find you a loan at the lowest possible rate. They earn a commission from the loan provider, not through you.  However, be aware that some brokers may charge you an arrangement fee.

Home loans

The largest loan which most people have to take up is a mortgage to enable them to buy their home. You would compare loans in the following categories, which are the most common types of home loans:

Other types of loans

Apart from home loans, there is an enormous range of loans on offer to cater for practically every need:

How to compare loans

When you compare loans to decide which loan is right for you, you need to balance these two factors—the amount you want to borrow and the time you think it will realistically take to repay the loan.

Most loans are repaid in monthly instalments over an agreed period. The longer the repayment period, the more interest you will pay. Try to borrow as little as possible and repay as quickly as possible. To avoid complications, before you sit down to compare loans, prepare a budget, and ask for only what you can comfortably afford to repay. Over-borrowing can lead to debts that may spiral out of control.

Compare loans' interest rates

Do not be attracted to low interest rates as these types of loans are normally not as good as they appear. When you compare loans and interest rates, consider not just the APR, but the TAR which is the Total Amount Repayable. This will tell you precisely how much you will ultimately have to pay back.

Exit or redemption penalties and overhanging lock-ins

Beware of lenders who impose heavy penalties if you wish to:

  • Repay your mortgage or loan earlier than initially agreed.

  • Exit from the mortgage or loan and move to another lender or deal.

  • Switch deals or lenders after a special deal interest rate has expired. 

Secured vs. unsecured loans

When you compare loans, you'll see that most loans you apply for can be taken up either as secured or unsecured loans. If you take out a large secured loan, you will be expected to put up a valuable asset—usually your home—as collateral against the loan. Interest rates for secured loans are better as lenders have your asset as security. Sometimes, borrowers use their car as a form of security.

An unsecured loan normally carries a higher interest rate as you are not required to put up any collateral. However, it can be viewed as a safer loan as there is no risk of losing your home even if you fail to make repayments.

Credit History

Before approving any sort of loan, all lenders will refer to your credit history record. Your personal credit score will determine whether you will be granted the loan for which you have applied.  Different lenders have different criteria, but all will use credit reference agencies such as Experian to assess your credit history.

As you'll find out when you compare loans, if you have a poor credit history as a result of arrears, bankruptcy, or CCJs, you may have to resort to applying for bad credit loans.  If you believe your credit history is inaccurate, you can ask the credit agency to investigate and if appropriate, amend your records.

Insurance

When you compare loans while loan-shopping, decide whether it is useful to take out payment protection insurance.  PPIs are not obligatory but can come in useful if you are suddenly faced with not being able to cover your repayments due to unemployment, sickness, or accident.

Always compare loans and all features of loans before making a final decision.

Compare the best personal loans

 
 
 
 
 
 
 
banner

 
 
© MyMoneyHelp.co.uk. All Rights Reserved.    Sitemap | Newsletter | About | Contact | Terms of Use | Privacy | Online Coupon Codes

Valid XHTML 1.0 Transitional

img