Not comparing credit offers
The first mistake many make is not comparing credit offers before applying for a personal loan. How do you know if you are getting a good deal without knowing the prices on the market? Some people go directly to their banker without even negotiating or involving the competition. This error is probably the one that will make you pay the most for your credit.
How to cure it ? Before even applying for credit from banks, use an online personal loan comparator like Financer.com to compare the best offers on the market. You will know which are the most advantageous rates for which you can claim. Then apply to three credit agencies to have a better chance of getting your personal loan at the best rate. If you prefer to borrow from your current bank, don’t forget to negotiate with your banker. He will surely be ready to lower his rate so as not to lose a good client.
Do not take into account the total cost of credit
The nominal interest rate offered by the financial institution is not enough if you want to compare loan offers or calculate the total cost of your credit. To this it is sometimes necessary to add any additional costs such as administrative costs. To compare and determine the total cost of your personal loan, you must use the APR, annual percentage rate. This rate takes into account all the elements of the total cost of your credit: interest charges as well as additional charges.
Know that with the possibilities offered by the Internet, it is now possible to take out a personal loan 100% online. No need to go to the branch multiple times or send your file by post. Thus, financial institutions offering you to take out credit online will not charge you any application fees. Beware, however, of the fraudulent offers that are multiplying on the Internet. For a list of trusted online credit agencies, you can visit Financer.com .
Burdening your credit with unnecessary insurance
In France, disability and death credit insurance is compulsory in the case of a mortgage but not in that of a personal loan. Despite everything, the bank will systematically offer you insurance. If your credit is small and short-term, it is advisable not to take out this insurance because it will unnecessarily burden your credit.
If, on the contrary, you want to borrow a large amount over a long period, you can think about it. Be aware, however, that you are not obliged to take out your insurance with the establishment where you take out your credit. Here too, take the time to compare insurance in order to obtain the most advantageous offer.
Sorry, the video player failed to load.
Not providing a safety margin
The personal loan helps you finance projects that you could not afford without this financial assistance, or to overcome a temporary difficulty. Although credit has many advantages, it is not a magic bullet. You will need to be able to repay your monthly payment and interest charges over the months and years to come.
So make sure you are able to repay your credit while meeting your daily expenses. For this, the total amount of your monthly repayments must not exceed 30% of your monthly net income.