You have a desire to renovate your home or escape to faraway countries, the acquisition of a new car or significant unexpected expenses: the personal loan is here to provide an answer to all your projects according to your repayment possibilities.
Take the time to think about it: credit commits you, so it must be repaid.
When rates start rising, many borrowers wonder whether it is in their best interest to approach a broker or their bank to get the best possible terms.
On the one hand, a loan broker is an independent banking and payment services intermediary who goes around the banks with his client’s file under his arm to find the best rate.
On the other hand, banks, with ambitious business objectives, know their customers and frequently agree to negotiate their financial terms to keep their “potential” customers.
Banks’ Strengths in Lending
The first reaction of someone looking for a personal loan or a mortgage is to go to his bank.
Note: this is a good reflex! It is better to ask him to make an offer, even if it means asking a broker to find a lower price and then measure the gain that could be obtained.
The request for such an offer can concern:
The personal loan: this credit can be affected or not affected. The borrower is then free to use the sum lent as he wishes.
Example: it is intended for those who wish to renew specific equipment (cars, household appliances, computers, sofas, etc.), finance a trip or a family event (wedding, christening, etc.).
Home loans: fixed or variable-rate, this type of loan commits the borrower over a long period.
Good to know: rates tend to rise.
Why Choose a Bank?
The main advantage of taking out a personal loan or a mortgage with your bank is the simplicity of the process. The bank knows its client and the history of his or her financial situation, which allows it to process the file in a relatively short time and without having to provide a lot of supporting documents.
Moreover, unlike brokers, who generally have pre-negotiated agreements with some banks, a banker has a wider margin for negotiation.
Banks have credit production targets that vary from one network to another. If a borrower is determined to compete on his own, it is in his interest to follow the commercial offers periodically promoted by the banks.
Good to know: before granting credit, financiers systematically consult the personal credit repayment incident file.
Why Do People Prefer to Choose a Broker?
Brokers’ Assets in Terms of Loans
Whether it’s a consumer loan or a real estate loan, brokers do not lack in assets: they are, in a way, the “heads hunters” of financing.
They are in charge of making the rounds of the banks to negotiate the best conditions.
A personal loan broker is a financial intermediary who is commissioned by an individual (borrower).
His main goal is to find the most advantageous interest rate at the most attractive conditions for his client by comparing the offers of financial organizations.
Thanks to the volume of loans they bring to the banks (more than 30% of total credit production), these intermediaries negotiate directly with the banks’ credit department. In addition to the application fees paid by the applicant borrower, they pay themselves by deducting a percentage of the amount borrowed.
They have the technical know-how and network to negotiate loan conditions more keenly than an individual could do alone with his or her banker.
Moreover, using a broker saves time since it is the broker who will compare the bank’s offers.
In conclusion, the broker will, therefore, put the different financial institutions in competition with each other to find the best credit corresponding to your needs, according to your repayment capacity.
Note: This competition does not only concern credit underwriting, but also the renegotiation of loans in service, the grouping of consumer loans, etc.
Where appropriate, the offers sent by a broker may be useful for negotiating (or renegotiating) a loan with your bank, which in some cases can be aligned.
Personal Loan Broker: For What Types of Project?
A broker or a brokerage firm can be called upon for several types of project:
development work: personal loan work;
the purchase of a vehicle: personal car loan;
leisure activities (holidays, purchase of a home cinema): personal credit for leisure activities;
treasury (marriage, financing of studies, unforeseen expenses).
Concerning the Purchase of Personal Loan:
If you are in the region of Melbourne, Adelaide and Sydney, it is advantageous and prudent to go through a broker specialized in credit redemption. Liberation Loans has been in business since 2006, and they will find a tailor-made solution for your financial needs.
Its essential objective is to rigorously study the best offer for grouping the various credits to avoid the filing of an over-indebtedness file. Hence, you can also get a personal loan repurchase.
