Here are our top 4 tips on what to take into consideration when choosing a loan provider for a personal loan.
1. Interest rates, fees, and charges
The first thing you want to look into is the interest rates, service fees, and any other administration charges that might apply. It’s common to just look at a low interest rate and assume that you’ll have to pay less money back, but that’s not always the case!
Some lenders will attract customers by advertising low interest rates, but there are a heap of additional charges and fees lurking in the background too.
Before choosing a loan provider, always do your research and find out what additional charges and fees you’ll be expected to pay on top of your loan amount. Keep this in mind and be sure you’re comparing apples with apples when looking at personal loan providers.
At Instant Finance, we believe in full disclosure. Your loan agreement will fully disclose the amount borrowed as well as a full breakdown of fees. You can find out all about our fees on our Rates & Fees page too. If you have more questions, our helpful staff will take as long as necessary to explain your loan agreement with you to make sure you totally understand your repayments.
Tip: If you know the loan amount you may need, try using a personal loan calculator to help estimate what your loan repayments may look like. Try out ours!
2. Customer service and support
Customer service may not seem like a big deal in comparison to interest rates and fees, but considering your loan repayment term may take a while to pay off, you want to make sure you’re provided with support and good communication when you need it.
Having the comfort of being able to talk to someone at any stage during the loan term, whether that be for help with establishing a household budget, or support during financial hardship, can make or break the decision when choosing a personal loan provider. Friendly, knowledgeable and supportive staff will listen to you and go that extra mile to make sure you receive the best customer service.
Have a look at the level of customer service and support on offer. Can you pick up the phone and speak with someone easily? Do they have good customer service ratings? Are they actively responsive to customer feedback on social media? Do customer service representatives genuinely take the time to understand your current financial situation and need for a loan?
To check out our customer service team, give us a call on 0800 760 000 or pop into your nearest Instant Finance branch.
3. Good ol’ T&C’s
While reviewing T&Cs are enough to put most of us to sleep, they’re so important when it comes to your loan. But do you know what you’re looking for? The terms and conditions should fully disclose all aspects of your loan, from the repayment schedule to due dates, early or lump-sum payments and everything in between. Depending on your individual circumstances, the repayment schedule can often be changed to best suit you and your ability to repay the loan within the loan term.
When considering a loan provider, it’s vital to ensure that you fully understand the terms and conditions associated with payments and payment schedules.
The fine print within a personal loan agreement should fully disclose everything you need to know, so always set aside some time to read and understand them. If you have any questions or a need for clarification, then simply ask. The response you get should be clear, understandable and helpful.
4. Trustworthiness and transparency
Some loan providers pride themselves on clever marketing tactics and flash advertisements which can blur the lines on which loan is best suited to you. When you choose your lender, base it on someone who will genuinely support you throughout the entire loan process and beyond, and work closely with you if times are tough.
It can be very enticing and convenient, to have a desired amount of money in your bank account within a few minutes of applying, but what happens when life takes a turn for the worse?
Our best advice for transparency is to start by asking questions about the loan agreement and its terms and conditions. If a loan provider is vague or hesitant at any point, reconsider your lender. Your loan provider should be transparent and open with all information relating to your loan – it’s to do with your money after all! The most trustworthy lenders won’t compromise their integrity of being a responsible lender if they believe a loan may not be the best option for your current situation.
Determine the trustworthiness of a loan provider by simply asking around. Talk to family and friends, take a little time to review social media channels, or read reviews online for impartial opinions from past or present customers.
At Instant Finance, we’ve serviced Kiwi’s every day for nearly 50 years, so it’s safe to say we have a strong commitment as one of New Zealand’s most responsible lenders. We’re an active member of the Financial Services Federation too – a non-profit organisation representing New Zealand's responsible, non-bank financial institutions. Their work includes setting industry standards for responsible lending, promoting compliance, consumer awareness, and working with the Government towards fair and enforced legislation.
If you’ve got any questions about your current loan or are thinking about one, we’re happy to have a chat, get you any answers and provide sound advice on understanding interest rates and fees, repayment schedules and loan terms, or how the loan process works. Give us a call on 0800 760 000 or visit your nearest Instant Finance branch.