You have just decided to submit a consumer loan application so you can refurbish the bathroom (which you have already postponed for a few months). The decision is made, but where do you start with so many different loans in the market? A quick look inside Google reveals that there are countless banks out there willing to lend you anywhere from $ 50,000-350,000. MoreNorth Bank, DE Money, Openpocket Finance and Mordea are just some of them. Finding the best consumer loan can be a difficult task. Before submitting an application for consumer loans, there are 4 things you should know about consumer loans.
1. Eligibility criteria for a consumer loan
Most consumer loans have strict qualification requirements. Here are some of the most common requirements you should meet before submitting a consumer loan application:
- Have turned 23 years
- No debt collection or payment remarks
- Gross annual income over $ 200,000 (base salary)
- Do permanent work and be resident in Norway
These requirements vary from bank to bank. For example, DE Money requires the applicant to be 25 years of age. It is therefore important that you check that you are eligible to apply for a consumer loan before submitting an application.
2. Early repayment fees
Some lenders will demand a fee from a borrower who wants to repay his consumer loan earlier than the agreed period. This is because the lender will miss out on the interest earnings that they would otherwise have had if the borrower had held the loan for the entire period. The fee you have to pay is usually a percentage of the outstanding amount.
3. Costs associated with late repayment
If you fail to pay your monthly fee you may be charged a cleaning fee. It is also possible for the lender to take legal action to recover the outstanding amount. Before legal action is taken, the outstanding amount is sent to debt collection. If you have borrowed from a bank where you also have your bank account, the bank can deduct the amount directly from your account. If you have applied for security, the bank can pledge the object you have set up as collateral.
4. How should you repay the consumer loan?
You just bought a new bath at IKEA and are in luck. Most of us love to buy new things but most of us like to owe money. It is therefore easy to forget that you actually have to repay a monthly sum over a longer period. Do you have a plan ready for how to repay your loan? If you want to be the king of your finances, you must have a plan in place! Sit down with pen, paper and calculator and figure out how much you have the opportunity to pay. Does the math go up? If not, wait to take out the consumer loan!