When Money Is Needed in a Pinch or to Help Pay for That Big-ticket Item

1. Find your interest rate, it’s called an Annual Percentage Rate (APR).
2. Is the interest rate is fixed or variable? Can it vary over time or will it stay the same?
3. Find your loan amount (often called Principal). This is the amount you want to borrow minus fees.
4. Understand the total amount you are required to pay back including interest and fees.
5. Find the total duration of the loan, often displayed as months or years.
6. Make sure you understand the penalty of late or early payment and any associated fees.
7. Understand all terms and conditions. You are entering into a legal contract with the lender so make sure you can meet all obligations.
8. Note how much your payments will be and when they’re due.
9. Retain your lender’s information in case you need to contact them, along with all related documentation.
10. Check to see if your lender allows early payoff or charges an additional fee for it.

Lenders need to understand two things: who are you and are you able to pay back your loan?

Most information collected verifies your identity, prevents fraud, and helps lenders to make their initial lending decisions. This information is also used by lenders to pull a credit report for you using a soft or hard inquiry with a major or alternative credit reporting agency. Lenders may call to verify your employment without discussing your financial matters. Get your annual credit reports at www.annualcreditreport.com.

Your residence information ensures lenders provide the right loan product for you and helps identify current expenses and payment history. Assets such as your car title may open up alternative credit options using collateral.

Using a co-signer could improve your interest rate and loan amount. However, your co-signer also needs to understand the terms of the loan as they must pay back your loan if you can’t.

Sometimes, even small inaccuracies or incomplete information can prevent approval. If you are active duty military you may not qualify for all products offered by the lenders.

Existing loans and other forms of debt can also prevent approval. Based on your income and expenses (debt-to-income ratio), you may not qualify for as much as you want. Asking for a lower loan amount could be an option. Learn more about debt management.

Lowering or eliminating expenses could help you qualify. We offer several resources to help you manage your personal finances. Learn more about money management.