From time to time, you may need a loan to supplement your income. Life is hard, and it is also expensive, so there is no shame in needing a short-term fix. The only issue with short-term fixes is that they come with ridiculous interest rates. These rates make the loan unpayable and unfeasible, so you have to go back to square one.
That is, unless, you can find a way to lower the interest on the loan and make it affordable. Fortunately, there are several ways, and this post knows them all!
Lower Your Credit Score
Your credit score is what lenders use to determine how risky it is to lend you money. The equation is simple: the bigger your credit score, the riskier the loan. That means they bump up the interest rates to try and make sure they see a return on their investment. The obvious answer is to lower your credit score, but how? Firstly, you can start by paying off any outstanding bills. Outstanding debts play a massive part in your credit score, no matter how small. If that is not an option, you can get a credit card. A credit card shows lenders that you know how to play the system. As a result, they are more likely to trust you.
Don’t Put All Your Eggs In One Basket
The first place you will visit if you are looking for a loan is a bank. Banks pretty much hold a monopoly on loans because they are the kings of the lenders. Still, that doesn’t mean that they are the only option. If what they have to offer isn’t suitable, try a credit union. Credit unions are designed to offer short-term, small loans for people in financial trouble. The repayment terms are much more favorable than those of the big banks. Or, you can opt for hard money lenders if you qualify. Just make sure you don’t go to a loan shark because that is a dangerous route.
Once you have all your option in front of you, you need a way to separate the good from the bad and the ugly. And, it is easy as long as you use comparison websites. These sites, as the name suggests, compare quotes and terms from lenders all over the web to find you the best deal. All you have to do is put in your search terms and wait for the results. Then, just go with the cheapest result that you can find. You can call the banks and ask them over the phone, but that is a lot of hassle.
Secure The Loan
Your final option is securing the loan with your assets. You may not have hard cash, but you may have equity or liquidity. Lenders are not picky, and they will use these forms of money to secure the loan. The security means that they don’t have to take as much risk. As such, they lower the interest rates to more affordable terms. From your point of view, this is a dangerous option because you could lose everything.
Make sure you think before you act.