1. What can you afford?
Working out how much you can afford to borrow over what period can be difficult. Increasing your monthly payments by just £20, for example, may significantly decrease your total repayment value. We’ve created a handy Personal Loans Calculator to see how much you could borrow and what your monthly repayments would be.
Many loan providers allow customers to make overpayments throughout the life of their loan, which can reduce the overall term and therefore the interest that they have to pay. However, if you want to completely pay the loan off earlier than planned it may incur an early repayment charge. So if you think this is something that you may wish to do in future, it’s wise to check with prospective providers.
3. Protect your credit rating
A provider may have the lowest rate on the market, but because APRs (annual percentage rates) are ‘representative’ only 51% of successful applicants have to actually receive those rates. In some cases, you won’t know the rate you will get until you have submitted an application, which could adversely affect your credit rating. But at Nationwide, we let you know the rate you’ll pay before we credit check you, by serving a no obligation quote.
4. Payment holidays
Payment holidays can seem like an attractive feature worth seeking out, as they can allow you to defer payments should you unexpectedly find yourself under financial pressure.
But they often mean that you pay more interest in the long-term and providers may have strict criteria that you must pass prior to being granted the payment holiday. If you experience any problems meeting your repayments, it's recommended you get in touch with your provider or alternatively, speak to the Citizen’s Advice Bureau.