Loans Blog

Earlier I briefly ran down the different types of loans but didn’t elaborate on private loans. So, let’s get to it. Student loans that come from private lenders can be a great way to pay for your education. But, it is a serious commitment. Private loans come with higher fees as well as interest and if you default, it can have more severe affects on your credit and your bank account than different types of federal loans.

Even if you think you won’t qualify for different types of federal loans, you should still apply and see what you can get because then you will need from a private lender. With that said, who should you approach for a private loan to pay for your education? You can approach your local bank or a national one but with whomever you decide to apply for a private loan from, look into it first. There are some things to keep in mind when considering a lender.

First, don’t fall victim to every marketing ploy out there offering a loan. Often times, students may find it alluring or assuring when they see an ad with a professional looking seal or emblem and just assume that the lender is legit. Look into the company offering the loan, the terms and conditions of a loan with them before ever accepting a loan.

Some lenders will offer immediate incentives for you to apply and accept a loan. This could be a gift certificate of some sort, gift card, cash, etc. These again, are ploys to get you to essentially sign your life away with the loans at interest rates you can never afford.

Google the lender with whom you’re considering doing business. You can find their track record online both legally and through individual reviews or posts by others. This is often a good indicator of what the company is like and how they treat their customers. It is important to look in depth into your private loan lender to know that you’re getting the best deal, that you understand the financial responsibility you’re undertaking, and that you’re sure you want to proceed.

If you don’t do any of that, you may find yourself in financial quick sand not being able to pay back your loans, missing payments and lowering your credit score all in one swoop of a pen.