Tuesday, December 3, 2013

Loan considerations for cash strapped folks

A lot of people are cash strapped during this time of year and that's understandable. Some people are looking for the fastest loans they can get to get them through the holiday season. The demand for gifts, covered dishes and extra expenses during the month of December is nonstop. All of that translates into extra expenses.

Some of the places where you can apply for loans include:

Cash stores
Banks
Credit Unions
Loan companies
Online lending companies
Mortgage company
Local or online cash advance companies

Pre-application Decisions

There are some decisions to be made before you fill out the loan application. Each decision is important even though each one may seem to be mundane. Some of the things to decide on include (but are not limited to) the following:

The amount that you need to borrow
Interest rate
How long you want to finance the loan
What monthly payment amount will work for your budget

Documentation that may be required for the application includes:

Most loan companies will require documentation before approving your application. The type of documentation you need is based on a number of factors. Generally, the necessary information includes:

Government issued identification
Employer contact information
Proof of income
Proof of employment
Address verification
Names and addresses of one or two family members who are not living with you.
Proof of previous address

Additional or alternate paperwork may be requested. The loan representative will tell you what to bring. It may be helpful to contact the lending company ahead of time. This way you know that you will have all of the requited documentation at hand.

In addition the Christmas holiday season, there are other times that you may need to borrow money. Cars, buying a home, investing in your business or start-up company, vacations and weddings are all common reasons to borrow money.

I always make sure to mention that if you're in the market for a loan, it's important to choose a reputable company. You want to make sure that all the terms are clearly spelled out in the loan agreement. Always ask for an explanation if you are unsure of any of the terms of any agreement.

Knowing your limits is important. It is easy to get talked into buying more than you can afford. Decide on a payment amount that is realistic for your budget. Stick with that amount. You can usually make additional small payments to help pay the loan down more quickly. It's much better to make the extra payments than to risk any chance of defaulting on a loan.

Call your lending institution immediately if there is any possibility of being late with a payment. Ask what your options are. No one ever likes to admit that they are in trouble. The fact is that job loss or illness can happen to anyone. Don't hesitate to make the phone call. It may be that the company will work with you. As hard as it may be, it is much better to have a difficult conversation than to default on a loan of any size.



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