When To Talk With A Bank About A Loan
Loans are some of the pillar products that banks offer, and there are many different types of loans that banks may underwrite. Depending on what you're going through, any one of these might be helpful in your financial situation. Here are some different times when you should talk with a bank representative about securing a loan.
Purchasing a House
Most people take out a mortgage when they purchase a house because few people have the financial resources needed to pay cash for a home. A mortgage is simply a loan that's specifically used to purchase a house.
While banks aren't the only place where you can get a mortgage, your bank should be the first business you inquire about a mortgage at. All banks can underwrite a variety of mortgages, and they can help you with any special federal mortgage program that you qualify for. The relationship that you already have with your bank will enable the bank to serve you well.
Buying a New Car
If you intend to finance the purchase of a new car, visit your bank before you go to the car dealership. Although dealerships themselves frequently offer financing, they often increase the interest rate on their loans slightly or add other fees that you must pay. As long as you qualify, you're likely to get a better loan from your bank.
To finance a car purchase through your bank, you'll have to apply for an auto loan with the bank and be approved. Once you're approved, your bank will give you a letter stating what you're approved for that you can take to the dealership. This letter serves as a guarantee that the bank will pay up to the approved amount for a car that you finance.
Taking a Once-in-a-Lifetime Vacation
If you have a dream vacation you want to take and only a limited window of time that you're able to take it in, a personal loan from your bank could help you afford the trip. A personal loan is an unsecured loan and normally comes with a slightly higher interest rate as a result, but the funds borrowed can be used for anything — including a final family trip.
Consolidating Credit Card Debt
You can also use a personal loan to consolidate credit card debt. Although the interest rate won't be as low as that of a mortgage or car loan, it'll likely be lower than your credit cards' interest rates.
For more information, visit a bank near you.