If you have decided to apply for an easy loan versus a loan from a traditional lending institution, there are some things you definitely need to be aware of before you sign on that dotted line.
This is because, if you do not pay special attention to every aspect of that easy loan agreement, it could end up costing you far more money than you expect.
Does the interest rate remain the same? — While easy loans NZ will already have a high interest rate, some even increase the interest rate they charge as the loan term progresses.
Make sure you know what your interest rate will be throughout the entire term of the loan, and do not sign up for an easy loan that has an increasing rate.
Do you understand all the fees? — Have the account executive you are dealing with walk you through every fee you will have to pay for that easy loan, and under every scenario.
Otherwise, you could end up paying hidden fees you did not know were included in your loan, and these hidden fees can be exceptionally high.
Are there penalties for paying a loan early? — One of the big ways companies offering easy loans charge you hidden fees is by applying penalties to anyone that pays their loan off early.
This means you need to be sure you will not be suddenly handed a bill for several hundred dollars, simply because you paid off your easy loan a month earlier than you had planned. Never sign up with a company that makes you pay a penalty for an early loan payment.
Are payments due every month or every week? — Some companies offering easy loans also allow you to pay weekly instead of monthly. While this may seem a good idea if the thought of a high monthly payment seems daunting, this is actually the worst way to pay off a loan.
Companies love adding weekly repayment plans, as this adds many more dates during the year where you may miss a repayment deadline. Every time you do, you will have to pay a penalty, giving even more money to the company that gave you the loan.
Longer time periods to pay off loans — While being able to pay off a loan over a longer period of time means you will also end up paying more money in interest, if you are not absolutely sure you can pay a shorter loan with a higher monthly repayment amount, this is the way to go.
After all, if you do take a loan out over a shorter period of time and then miss a payment, the penalty you will have to pay could be as much as your monthly payment.
Err on the side of ease when it comes to repaying an easy loan, as you can always pay it off faster if you like. As long as there is not a penalty for doing so, of course.