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How to Find the Best Lender

by James McGregor

If you are looking for a loan, then it is important to do a lot of research so that you are able to choose a lender that will suit you really well. You will find that there are lots of lenders that you could pick from and this means that there is lots of competition and choice. Although this can be good and means that you are more likely to then be able to find something suitable for your specific needs, it also means that there is a lot of research work to do and that can take a long time. It is therefore important to know what to look for. It can be wise to think about what you are looking for in a loan. You need to think about things that might be important to you such as value for money, well-known lender, costs, good customer service, local branch etc. Think about what you want and then you can make sure that lenders will fulfil your needs. 

Use an Advisor

In some circumstances it can be wise to get professional help with things. If you are choosing an expensive loan, then this could be one of these situations. It is a good idea to consider how much money you might save if you use an advisor to find you the best value for money loan. You will have to pay them a flat fee though, these days financial advisors are not allowed to take commission, as that led to them recommending products that made them the most money and so not necessarily those that benefited their clients the most. Do make sure that you choose an independent advisor though. Some are affiliated with a company and so they will only be able to talk about that company’s products whereas an independent advisor will look at the whole market. It is worth finding out how much the advisor will cost and this will help you to be able to decide whether you feel that it will be worth paying the money. If you are borrowing a small amount it may not be worth it, but if you are borrowing lots of money then it could be very worthwhile as you could end up saving a significant amount in interest.

Comparison Website

You could do some or all of the research yourself. A comparison website for example, could be a good place to start. These websites will compare different lenders on cost and you will be able to see which would be the cheapest one for you to use. This can be really useful if you want to find out who is lending money, but they have their limitations. Firstly, not all lenders are on comparison websites and so you could be missing out on better loans, if you only rely on these websites. Some lenders will not allow comparison websites to list them and some do not pay much commission to these sites and so the sites will not feature them. There are differences between sites as well, as they will not all list the same lenders or the same loans and so looking at a selection of them could help you to make sure that you see more loans that are on offer and compare more of them. You may also find that they will only compare interest rates on loans and some loans may have fees as well, so you will need to make sure you check for this. It is also wise to compare any charges they may make, for example early repayment fees or late payment fees and if you think you might have to pay these, then it is well worth knowing what they might be. 

Own Research

It is worth bearing in mind that you could find that you will not get the advertised rates for loans. This is because the lender will show their very best rate, but if your credit record is not favourable, they may refuse the loan entirely or let you have it but at a higher rate of interest. This might seem unfair but it is the way they work and therefore worth making sure that you check with them so that you can make sure that you are fully aware of the rate that you will be paying. You will also be able to discover the lenders that are not on comparison websites and see whether they will offer you more favourable rates. 

It does take a lot of time to do the work yourself compared to using an advisor. However, you will need to be sure that it is worth paying an advisor as you will want to make sure that you will be able to make back all of the money that you have paid out for the advice. If you are only borrowing a small amount of money. Then there will not be so much money to save anyway and perhaps doing as much research will not be so necessary anyway. You will have to think about how much your time is worth and whether you feel that you want to be spending the time researching or whether you are okay with just paying a little more money for advice or just plumping for one of the first loans that you see. 

As well as cost, it is important to compare lenders on other things too. Consider whether customer service is important, whether they can be dealt with online, over the phone, in a branch or by a method that you will find to be useful. You may want to deal with a lender that you have used before so that you can be sure that they will treat you well and be friendly and helpful.

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