How To Get a Personal Loan in 5 Easy Steps
South Houston Credit Union strives to provide union members with the best loan products to suit their needs. We provide both personal and business loan products that could be just what is needed to close the gap in funds and hit those financial goals. Everyone, at some point, will need a loan. Given this, we would like to provide an easy guide to help our union members to have the best shot at getting a great loan with the best interest rates possible. Please see below how to get a loan in 5 easy steps:
- Self-check #1: The Reason
The first step to getting a loan is first assessing the situation that causes the loan to be a necessity. Why is the loan even needed in the first place? This should also be coupled with a brief search for all solutions to the problem, including the loan. Often times, the banker will ask a client why the loan is needed. There is a reason for this. Be sure to come prepared with any needed documentation and a good reason to have requested the loan.
- Self-check #2: Credit History
Another good self-check measure would be to get a brief overview of the credit history. This would be a vital part of the loan application process and should not be neglected. This one step could wind up saving an applicant a lot of time and effort and a potential hit on their credit profile by just checking. Sometimes getting one or two things corrected could mean the world in credit score and in turn, help to save money in helping to get a lower interest rate. The major credit bureaus give out one free credit report each year. There are also sites like Credit Karma that can give a good estimate of credit and what might be made up said credit score.
- Budget the potential loan
Considering if the loan is approved, it might be wise to make sure that the loan can properly fit into any existing monthly or personal budget. The loan underwriting team will figure out the larger monthly obligations of the borrower that are sure to be a part of budgeting in most cases. Utilities and rent or commercial leasing payments are usually of the most common that are included in the loan determination. If the monthly obligations take up a reasonably small portion of the income of the applicant, this is a good sign.
It might also be wise for a borrower to calculate their full monthly obligations from a personal perspective and see if the loan makes sense. It is much easier to know if the loan terms make sense when they are offered and for the borrower to have an idea of a maximum monthly payment before walking into the bank.
- Research Loan Institutions
South Houston Credit Union would love to have your business. There are many benefits to having banking and loans all under one roof. The ease of a simple monthly transfer could be very tempting. However, it might be a good idea to explore multiple avenues of getting the best loan. Comparing loan terms and rates would be especially wise if the loan being requested is a larger loan.
- Approach your banker
Once an applicant is armed with all of their documentation and has explored all reasons on why the loan is required, the application process can begin. The applicant will fill out the information on the loan application, the bank will make a decision on the loan and start to discuss the loan terms. The previous steps, if completed properly, should facilitate healthy dialogue and negotiation with the banker. Should all go well, everyone will agree on the loan terms and the applicant walks away with the funds that they need.