Loan companies can arguably save you when you are in a financial crisis situation. As a potential borrower, you have to weigh your options carefully and study each of the terms and guidelines of each loan company so you can get the most out of your loaning experience. Since there a multitude of loan companies out there, we are here to help you out in choosing the right loan company for you.
Here are Seven Qualities of a Good Lender that you have to watch out for:
- Sufficient Lending Limit
A good lender should be able to have sufficient lending capacity. Always check out the credentials of your lender to ensure that they can provide the cash flow you (and every single one of their borrowers) need. You can check out their financial report trend over a five (5) year lifespan and watch out for reviews from their borrowers to see if there are complaints about their lending limit.
- Flexible
Even if lenders have specific and often strict guidelines on lending money, choose for a lender that can offer flexible terms within your paying capacity, without bending or breaking their imposed guidelines. The options can either be lowering the interest rates or extending the maturity date of your loans.
- Responsive
For the non-financially savvy people, bank jargons can often be confusing and intimidating. Choose a lender (and a financial advisor) that can help you explain what is happening to your money, and someone patient enough to answer your questions, redundant they may be!
- Unparalleled Reputation
Financial scams are everywhere and as a borrower, you have to be vigilant in order not to fall through its traps. Be curious! Ask financially literate questions about your loans and if you feel that you are not getting sufficient answers, ask around. It also helps to check out reviews from other borrowers about the financial reputation of the lender. Lastly, check if your lender is part of the top ranks of the loaning industry.
- Experience
It is also worthy to invest time in searching for the number of years that the lender company has been operating, especially in gauging whether or not you would borrow from them. Usually, those who have been operating for more than fifteen (15) years are the best lending companies to borrow money from, solely based on the fact that they have operated for quite a long period of time.
- Transparent
In any business dealing with money, transparency is a MUST. Choose a lender that will be upfront with the fees they will charge you with, as long as the risks and repercussions in the event that you will not be able to pay in a timely manner. In addition, the lending company should also be transparent in how they operate – which means they should be able to explain the operating principles they work in, and their current financial situation.
- Interest Rates
Interest rates differ from one loaning company to another. You have to be wise in choosing companies with different interest rates. Some companies charge you with sky-high interest rates while other unreliable loan companies entice you with very low interest rates, only to scam you in the end. It is best to choose a company that is well within your paying capacity.
As a potential borrower, it is your right to choose the best loaning company to borrow money from, and not the other way around. Keep in mind the characteristics above to make sure that the interest rates you pay will be invested in the correct company.