Personal Loan Application Tips

Submitting a personal loan application causes apprehension in some people, especially if you have shaky credit or are unsure what’s on your credit report. Even with its polished marble floors and hushed interior, your bank isn’t a scary or foreboding place. Even if you’ve never applied for credit before, you can stride into your bank with confidence and get the money you need.

Know Your Needs

Before you submit a personal loan application, it’s smart to figure out the exact nature of your request. How much do you need? How much can you afford to repay each month? These are questions the lender will likely ask, so be ready to answer. If you can’t, you may end up with too little money to meet your needs or payments you can’t afford.

Shop Around

Your bank decade is a good place to start, but don’t forget about your other options. Check out the offerings of the other banks in town, including those that are small and locally run. Another option for your personal loan application is internet banks. Some have lower overhead because they lack a brick and mortar building and they may pass their saving onto you in the form of lower rates and application fees. Your goal is to find the most money for the lowest cost.

Stay in Control

Lenders learn early in their careers to control the direction of the conversation and get the personal loan application while you’re at the desk. Remember that this is your money and your credit, so you aren’t obligated to apply with any lender simply because you took up time to get the information you need. You decide when and if you’ll apply for a loan.

Also, keep in mind that applying for multiple loans to find the best rate is not a solid strategy. Your credit is pulled each time you apply. If you must apply for more than one loan, narrow down your options to the top two or three lenders and apply with each to minimize the inquiries in your credit file.

Be Prepared

While every lender is different, compile basic information and documentation in a folder to make the personal loan application process easier and less time-consuming. Include your social security number, gross annual or monthly income, paystubs or self-employed tax returns and employer contact information. If you’re using the loan to make a purchase, include the contract showing the purchase price. Depending on how long you’ve been with your company or at your current address, the lender may also need previous employer information or your previous addresses.

Taking the time to research companies and evaluate your needs before submitting a personal loan application allows you to apply only once and still get the best deal available.

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