5 Common Mistakes Many People Make When Applying for Personal Loans

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Personal loans. These loans can be lifesavers sometimes, especially when you fall into a sticky situation that you aren’t financially capable of getting yourself out of. You may even find that the emergency money you have been saving all this time doesn’t quite cover it. The next best thing you think of is a personal loan. These loans are pretty easy to apply for and get which makes them even more attractive.

That being said, here are some 5 common mistakes most people do and you might also end up doing while applying for and taking a personal www.lendgreen.com loan. Try and avoid these mistakes as they will easily get you in trouble with your lending agency.

1. Lack of research and/or comparison

This is a very common issue. Most people are always in such a hurry to get the financial help or debt  that they jump into the first lending office they get. Often at times, this never works and if you try this, chances are that you are going to regret it sooner rather than later.

You need to “test the waters”. Ensure you conduct proper research and know your financial options. Look for the lenders with the most competitive rates by visiting online verified comparison tools. You can also seek financial advice from financial experts and learn about any other possible alternatives which you can explore. Doing research and asking around for the best lending agency is usually a lifesaver when it comes to personal loans.

2.Failure to read the fine print

This is also another mistake most borrowers always do. In fact, almost everybody is affected by this “symptom” when it comes to purchasing just about any other product available. And the personal loan is no exception. It’s easy to miss out some minor details on the contract due to your carelessness which may end up costing you a lot more than you bargained for. The lending agencies will make you sign dozens of documents, all of which, if you fail to read through carefully, can have you paying exorbitant fees. Read the fine print, which clearly states the annual fees, commissions, bank charges, closing costs, balloon payments, and length of loans. Better be in the loop and not miss even the hidden clauses either.

3. Incomplete disclosure

Never leave any ‘ifs’ or ‘buts’ whenever you are filling out the loan application forms. It is vital that you fill out all the necessary parts with accurate information, complete honesty. Be precise as possible.

Providing false information or incomplete disclosure can end up hurting your credit rating and sometimes even lead to legal action. You may end up being forced to repay the loan immediately, plus a hefty fine on top of that for committing fraud.

4. Going overboard

This mistake is especially common with most borrowers. You will find the lending agencies have offered you huge sums of the total loan you are eligible to borrow. A lot more than you initially needed in the first place. You can be tempted to go for the maximum amount which isn’t always a good idea. You need to ensure you exercise extreme caution whenever you are applying for a personal loan. Estimate the amount you need to suit your needs and only borrow that. Large amounts come with more interests attached to them, plus the recurring expenses.

5. Patchy paperwork

At times you may get so occupied that you feel you don’t have the time to deal with all the loan application paperwork. But failing to get all your paperwork in order can also cost you your chances of getting that loan as well. Don’t cut corners with your paperwork. Nobody likes that, not even you for sure.

To conclude

It is vital that you find one time or day when you are free from any other work and apply for your personal loan. Don’t rush through the process and end up making such mistakes. Be patient and thorough with all the documents as well.

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