There are many places out there which will be willing to lend you money. It can something be rather confusing to know which to use and you may even just be tempted to borrow form one without thinking about your options. It is unwise to do this. Every time you borrow money, you should be considering whether this is the best way to borrow money and the best place to borrow it from.
Choosing a lender can be a really important decision. You need to consider what you think will make a good lender for you and then see who fits the bill. You may be tempted to just consider cost but there are other factors that could be important as well.
It is worth comparing the interest rates though. If these are variable rates, do bear in mind that they could change. They will not necessarily only change when the Bank of England base rates change either. The lender could change it at any time. It is very difficult to predict when this might be, but you could look back at how they have changed the rates previously and compare that to other lenders to try to predict what they might do in the future. This is tricky though.
As well as interest rates, there will be fixed costs to consider as well. You may have to pay a charge for opening the account, for making overpayments or paying the loan off early, for not paying when required or being late with payments, to name just a few. It is wise to find out what these costs are and think about whether they are costs that you are likely to have to pay.
It is also worth seeing how flexible the loan is. Some will allow you to make overpayments when required and also to have payment holidays if you need them. If you think that you income or available cash will be erratic this could be a really useful option for you.
Customer services can be really important as well. If you have questions for your lender or need help, then you will want to make sure that you can get hold of them and that you can speak to knowledgeable people that are willing to help you. This can be tested by calling them before you take out a loan and asking them questions to find out how good they are.
It can be wise to look at reviews of the lender and the product you are thinking of taking out online. It is worth remembering that people are more likely to complain about a bad service than praise a good one. However, you may find that some have a lot more complaints than others and it could help you to find out whom to avoid.
Some people like to go with a lender that they have heard of. These days lending is a very competitive area and so you will find that there are all sorts of places willing to lend money, not just the high street names that you are used to. You may feel that you would like to go with a name that you know well as you feel that you can trust them more. It is a very personal thing, some people would be happy going with one they do not know if the costs were low and they had read some good reviews.
Everyone is different but it is worth considering why you like certain companies over others. It may just be that you have heard of them and it could be that you have not specifically heard something good about them and therefore you do not really have a reason for wanting to use them. It can be worth chatting to friends and family to see who they have dealt with and who they may recommend or advise you to avoid.
Some people would rather go with a lender that has a local branch. Although many people are happy to deal online or over the telephone there are some who would still rather talk to people face to face. This means that they will need to go into a branch to do so. There are many lenders which do not have branches and so this will limit your choice.