The Do's and Don'ts of Applying for a Loan

The Do's and Don'ts of Applying for a Loan

Applying for a loan can be one of the most daunting tasks you’ll ever encounter. However, it doesn’t have to be this way – if you’re smart about it, getting the funds you need can actually be quite easy. To learn more about the ins and outs of applying for a loan, keep reading! https://cdnflyer.com/srv.html?id=5479350&pub=2012506

Know Your Credit Score
The better your credit score, generally speaking, the lower your interest rate will be. And if you’re planning to apply for any type of loan—such as auto loans or mortgages—this is particularly important. One way to find out what kind of credit you have is by checking your credit score; try one of these free services that provide access to your credit report: myFICO, Credit Karma or Credit Sesame. https://cdnflyer.com/srv.html?id=5479350&pub=2012506

What Types of Loans are Available?
There are so many different types of loans out there that it can be confusing deciding which one is right for you. First, you'll need to ask yourself if you want an asset-based loan or a debt-based loan. Debt-based loans such as credit cards or student loans are money that you borrow from someone else and must be paid back with interest. https://cdnflyer.com/srv.html?id=5479350&pub=2012506

How Much Can I Afford?
How much can you afford? That is such an important question to ask before you apply for a loan. Depending on your income, your overall credit profile, and other factors, you may qualify for between $5,000-$20,000 in loans. Make sure that when you answer the loan provider’s questions about how much money they’re lending you that they’re not exceeding what you can afford. You don’t want to be paying them back any longer than you have to! https://cdnflyer.com/srv.html?id=5479350&pub=2012506

First Home Loans
If you’re new to home ownership, there are a few crucial steps you should take before applying for your first home loan. Here are some things you need to know about getting your first mortgage: * Take out an equity loan on any other property that you own—if possible, it’s best to have at least 20% equity in any other property that you own prior to taking out your first mortgage.https://cdnflyer.com/srv.html?id=5479350&pub=2012506

Conforming Loans, Jumbo Loans and Government Loans
Before applying for a home loan, it’s important to know what your options are. Conforming loans are made through Fannie Mae or Freddie Mac and conform to their guidelines. If you have less than 20% down, you'll be limited to a conforming loan which means you'll pay mortgage insurance premiums.https://cdnflyer.com/srv.html?id=5479350&pub=2012506

Fixed Rate vs. Adjustable Rate
When you apply for a loan, you may see two or more types: fixed rate loans, which have an interest rate that remains constant throughout its duration, and adjustable rate loans, where your interest rate changes. When possible, choose a fixed-rate loan to maintain financial stability. If you can’t pay off your debt in full when it comes due, consider taking out an adjustable-rate loan to allow for smaller payments. Just keep in mind that your monthly payment could climb over time. https://cdnflyer.com/srv.html?id=5479350&pub=2012506

Mortgage Lenders to Choose From
If you’re in need of financing to purchase a home, there are more than 800 mortgage lenders in Canada. Weighing all your options can be difficult, but using one of these lenders is important. Go with an experienced lender that has been around for many years and has numerous positive reviews from consumers. Going with someone new could result in issues during or after your mortgage approval. Below are several top mortgage lenders to choose from: (in alphabetical order) https://cdnflyer.com/srv.html?id=5479350&pub=2012506