There are certain times in life when people need to borrow money, no matter what their profession. Personal teacher loans can be used for a number of different reasons such as for home improvements, consolidating your debts, paying the cost of your car repair bill or funding your daughter's wedding. One of the main aims when getting a loan is to get the one that will work out to be most affordable and flexible for you in your current personal situation.
For starters, the best way to find the right loan for you is to make sure you compare. The internet is a great tool, so utilise it. Comparison equals choice and the internet gives you the chance to compare several lenders all at once, making it an ideal way of giving you choice, in a fraction of the time it would take to call. It is quick and easy do which saves you lots of precious time (with which to mark more papers!).
Anybody can apply for a loan, but it seems to becoming more and more common for young professionals to start applying for online loans. Loans for teachers and other professionals are very common nowadays. Obviously the cheaper the loan the better, and there a few good ways in which to ensure you have secured the cheapest loan deal possible.
The number of companies that offer loans for teachers, can provide low cost loans, but there are certain ways to increase your chance of being approved for a cheap teacher loan. Here are 5 pointers to getting the cheapest loan possible.
1. Get a secured homeowner loan
Homeowner loans for teachers [http://www.loans-for-teachers.co.uk/] can work out to be one of the most economical ways of borrowing money. If you are planning to apply for a large sum of money they could well be your best choice. A homeowner loan is also known as a secured loan because you must be paying a mortgage to be eligible for one. Your house is used as security for the lender which enables them to offer a cheaper interest rate, and allow you a longer repayment period. The amount of money you can borrow will depend on the equity available in your house. For example your property is worth £200,000 and your mortgage balance is £120,000 leaving £80,000 equity, so in theory you could loan up to £80,000 (sometimes more, sometimes less) depending on which lender you use. The main downside is that if you cannot keep up with your repayments you are at risk of losing your home to repay the loan borrowed on it.
2. Get a bigger teacher loan
I know this sounds a strange statement, however it could work in your favour. Many loan companies have a tiered scale of interest rates that change depending on what amount of money is borrowed. Smaller loans which are mainly paid back over a shorter period of time, are effectively less profitable for the lender, so a higher interest rate is generally charged. By just going over to the next stage, you could end up on a cheaper interest level and pay less overall. Find out what the levels of interest are, you may find that borrowing £4500 could have an 8.9% interest rate whereas £5000 could have a lower interest charge of 6.9%. Despite borrowing more, the Total Amount Repayable (TAR) could be lower. Just make sure you do your calculations beforehand.
3. Employment history
Being in a good job, such as a teacher or any other education professional, can rule in your favour. Lenders will always look at the employment history of each applicant and use it as a basis to make their decision on. Teachers have good job security and with there being plenty of employment opportunities, you are unlikely to become unemployed. Teachers also enjoy a good salary when compared to the national average and so as a rule loans for teachers are often readily offered and at a good rate too.
4. Good Credit History
It is essential to have a good credit history when looking at applying for a teachers loans [http://www.loans-for-teachers.co.uk/] and expecting to get the cheapest deal. Every time you apply for, use or make a payment to a loan, mortgage, credit or store card you leave a 'footprint'. Missed payments, defaults and arrears will all be recorded for a certain time and could damage your credit rating. This won't stop you getting a loan, it just might mean you pay a slightly higher interest rate than normal. Make sure you appear on the electoral roll. By being on an electoral roll will stand you in good stead and act as an extra gold star on your credit rating.
5. Get a shorter loan
If you are applying for a loan for teachers, try and set the repayment term for the shortest amount possible. Be realistic about what you can afford each month for repayments and work out how quickly you can repay the loan in full. The idea is that by having the loan for less time, you will end up accumulating less interest on the amount you have borrowed, meaning you would pay less overall for a 3 year loan than you would for a 5 year loan.
There are plenty of loan types available but the most two main ones are secured loans and unsecured loans. Each one has it benefits - and downfalls - but it is worth looking into which one will provide you with the best financial deal.
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