Before Signing Loan Documents, READ The Fine Print

Obtaining a secured loan on your home can indeed save you a lot of money by helping you consolidate debt or paying off your credit card debt. Below are things you should consider before signing loan documents.

Before jumping and signing loan documents, be sure to watch out for personal loan ripoffs that can lead to more expensive loans or even losing your property. Personal Loan Interest Rates: The Interest rate determines how much money in installment payments you are going to pay, and the total cost of the loan. Before settling on a secured loan, consider interest rate shopping to see if you can getter a better deal. Few percentage points increase in interest rate can lead to thousands in additional payments. Consider inquiring from about three to five lenders to see if you can save. Sometimes we ignore those 20- 30 pages but some lenders like to slip some terms and conditions in there.

Before signing loan documents, READ the fine print. Most common is Early payment fees. This can be frustrating. Some lenders will penalize you for paying off the loan early. Look out for PPI- Personal Payment Insurance: PPI is one way to make sure that your loan does not turn into a financial burden. This is however not calculated into the total cost of the loan. Its optional and you may substitute disability insurance if you have any.

Thus your monthly payments may be more than listed on loan agreement. Sometimes lenders will bundle Personal Payment Insurance into the cost of the loan without informing consumers about it. PPI is great but the cost can be extremely high. If you absolutely need PPI, research other sources to find out if you can get the insurance at a cheaper rate. Monthly payments are not the only factor to consider when calculating yourpersonal secured loan loan. Do not feel obligated to take out PMI with the lender, you can get insurance from somewhere else. Additional costs such as PPI, loan closing fees and ledger fees should be added to the total cost of the loan.

We have seen reduced interest rates for 6 months! Introductory rates can also be deceiving. What happens after that? Reduced interest payments may end up accumulating interest which in turn bears more interest. Do the payments increase in an attempt to bring the loan to term? Watch out for unsolicited offers.

Some loan officers will get paid more if they sign you onto a high interest loan. Research such companies and brokers. Door to door marketers should also be avoided. If he does, that raises a red flag. A loan officer should not pressure you for an immediate decision. You should take time to discuss the loan documents with a qualified person. Most of the time a hurried decision leads to mistakes that can lead to hundreds in payment costs.

You should not at any time be forced to make an immediate decision. Any company or broker that asks for a deposit/ security is obviously a fraud.