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Dos And Dont’s of Getting Personal Loans

Borrowing money via personal loans, especially significant amounts of it, is a serious endeavor. You’d want to get it right the first time around because having a hard time settling it would mean trouble for your future attempts to borrow cash. Hence, it’s important to get the best loans possible.

DO: Explore all options

Let’s face it; the personal loan is not the only way to borrow cash. Other options may include loans from friends/relatives, payday loans, or other forms of bank loans. But the personal loan is one of the more favorable options to get when it comes to borrowing money.

DON’T: Go for loan sharks and dubious online loans

These predatory products, which are not subject to regulations, may end up causing you more harm than good. The common loan sharks impose a high 20% interest rate, while some Internet-based loans that ask you to send over money first are more likely to be scams.

DO: Research on each bank’s personal loans

Yeah, we know you need the money fast. But depending on how soon you need it, doing at least an hour’s worth of research on as many bank offerings as possible can save you thousands down the road.

DON’T: Settle for quick loans when there are better ones around

No offense to those loans, as some of them might be good deals, but you might regret not spending a day or two seeking out other loans if you do end up seeing an offering with more favorable details.

DO: Read all the fine print

Speaking of details, you better be aware of all the fees and interest rates and other minutiae from the personal loans you’re considering to get.

DON’T: Apply for personal loans from multiple banks simultaneously

Don’t think about back-ups. Banks know when you do this, and they frown upon this practice. Besides, this act makes you look less attractive ad more desperate to prospective lenders. Dyahe, right?

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DO: Pursue one application diligently

With that said, it’s best to study personal loans from various banks first and stick with one option you prefer best. This makes you appear more well-researched and trustworthy with money.

DON’T: Forget about your other debt obligations

If you have other debts outstanding prior to your personal loans application, you’d need to take them into account. Besides, these debts play a factor into whether you’ll be approved for your loan.

DO: Calculate the monthly payments you’ll have to make

Bring out the loan calculator for this one. Put in the amount you need and the number of years you plan to pay. If the monthly payment is at most 30% of your income, you have a greater chance of getting your loan approved and being able to pay it off.

DON’T: Over-borrow on your personal loans

Even if you’re eligible for a higher loan amount compared to what you actually need, don’t be tempted to grab that opportunity. Remember that bigger loan amounts translate to larger interest payments. And we do want to keep those at the minimum.

DO: Talk it up with your preferred bank

Banks may seem intimidating at first, but they sure would want more business from you. It won’t hurt to try to negotiate for more favorable terms for your personal loans, especially if you have other accounts with that bank, as soon as you’re close to assured that you’ll be approved for the loan.

DON’T: Be blinded by bonus offers

With that said, some banks can offer you some freebies to entice you to get your personal loans from them. Unless the incentives they offer can help with paying down your debt, these bonuses only serve as distraction.

DO: Submit complete required documents from the get-go

Having all the required documents with you upon applying for personal loans will speed up the application process by a day or two. This helps especially when you have a deadline to catch.

DON’T: Do any of the stuff that will trigger miscellaneous fees

There are certain actions that lead to additional fees for your personal loans. Try to avoid them whenever you can, unless you really need to.

DO: Pay on time

And we mean on-time, not earlier, not later. Some banks attach early payment fees on their personal loans for some reason, and of course paying late will incur additional fees.

Here are our other articles about personal loans and how to manage them:

ONE FINAL DON’T: Don’t forget to compare personal loans online with GoBear Philippines

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Going back to Do #1, as well as the other dos, having more knowledge about all the available personal loans can help you select the one that’s best for you. GoBear Philippines will surely help you with that, with its metasearch offering that goes through every detail of a personal loan to show you which ones are most suited to your needs.

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