With correct research and planning, loans are effective sources of financial support to help realize your goals and through those goals, your dreams. Even so, it’s important to remember that depending on your financial situation, many details surrounding your loan are susceptible to change, such as the interest rate attached to it.
Factors such as your credit score, whether you are a newcomer to Canada and your current employment all go into determining the loan that you’ll be approved for and the interest rate that will be attached to that loan! If you’re looking to explore a loan as a tool to reaching your goals the following tips will assist you in achieving the lowest interest rate possible.
Have a Good Credit Score
A higher credit score tends to translate to a lower rate of interest on a loan. Use these tips to maintain a good credit score:
Credit Card Balance: The higher your credit card balance, the worse your credit score tends to be. Ideally, try and keep your credit balance within 30 percent of your limit.
Credit Report: Even if you’re doing everything right, others may not be. It’s important to check your credit card report throughout the year, to ensure all information is accurate.
Use Soft Searches
When trying to get a loan, avoid applying for multiple at a time. Every time you apply for a loan, a check is applied on your credit report by a lender. These credit application searches, also referred to as ‘hard searches’, leave a mark on your file that can damage your credit score. By utilizing quotation search, or ‘soft search’, tools your searches can’t be seen by lenders. Using this search method, you’ll be able to look into as many potential loan options as you’d like and only submit a full application on products you’re likely to get.
Make Sure a Loan is the Right Option for You
Remember, a loan is a large commitment that has the potential to stay with you for years. Prior to committing to this course of action, make sure you do your homework! At Instant Financial Group, our team is dedicated to providing you with a loan plan that will set you up for long-term success, while giving you the financial support to achieve you current objectives.