27
Apr
2020

Which are the Best Lenders for Instalment Loans?

When you have decided that you wish to take out a loan and you know which type of loan to get, then you might want to then think about which lender to go for. This is actually more important than you might think. This is because you will find that they could differ quite a lot and this will mean that some will be much better suited to your needs than others. Although they are all offering the same type of loan they could be different in the following ways:

Cost

The cost of each lender is likely to be different. If you just go with the first lender that you come across, then you could find that you will end up paying more than necessary. It is therefore important to check this out. Many people will compare lenders according to the interest rate. This is a mistake though. The interest rate is not a good way to compare. This is because firstly, there might be different ways of calculating the interest rate. Some it is just annual percentage rate charged on what you borrow and others it is the Annual Equivalent Rate which includes any charges and fees as well as the interest. The second will be higher than the first so you may pick what looks like a cheaper lender but find out that they are in fact not cheaper. Therefore, you need to be very careful and look at the interest and other charges to see what the total fee will be. This is something that may not be easy to calculate. Some lenders will have a handy calculator so that you can work it out, but if you are unsure you can always ask the lender. If you can find exactly how much you will be repaying in total, then you will be able to more easily compare them with other lenders.

Repayment term

It is good to find out how long you will be repaying for. Instalment loans tend to be repaid over a few months, but this will vary between lenders. It may also depend on how much you choose to borrow. It is a good idea to make sure that you are aware of how many repayments there are and how long the loan will last. You might want it to be over pretty quickly and so you may prefer to go with a lender that has less repayments. You may also need to think about whether you will be able to afford the repayments for this amount of time. It might be that you have some expenses coming up and you need to make sure it is repaid before then. Make sure that you check and have a think about this.

Repayment amount

The amount that you need to repay is really important too. You will find that if you have smaller repayments they will be easier for you to manage. However, if you have larger ones the loans will be repaid sooner. It is important to make sure that you calculate how much you can afford with regards to the repayments and make sure that you will also be able to afford everything else that you need to buy. Then you will know that you are taking on a loan that you will be able to manage and you will be lowering the risk that you might miss a repayment due to not having enough money and have to pay extra fees as a result.

Customer service

You may want to find a lender that has good customer service. It can always be reassuring to know that if you have questions or queries or any problems, that there will someone there to help with this. Some lenders are better at this than others. It can be worth actually contacting them to find out what you think of them. You will be able judge them on how quickly they respond, how polite they are and how helpful they are which is likely to be indicative of how they will be with you if you are actually a customer.

Reputation

For some people the reputation of the lender is important. They feel more confident if they are using a lender that they feel other people like and that is generally liked. This means that they might like to look at reviews in order to judge them. This can be useful, but it is a good idea to make sure that the reviews are unbiased. This is not always easy, as there are all sorts of reasons that they could be such as lenders reviewing themselves well and/or others badly and review sites getting paid commission for leads they generate through positive reviews so will review better paying lenders more highly. It can be best to rely on people you know for reviews as they will not have any reason to be biased and they will also have your best interests at heart so will not make a recommendation they think is not good.

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