Flexibility
Look for flexibility in the repayment terms.
Some lenders allow you to overpay - ie when you're flush - and underpay when you're not.
Otherwise you could find there are nasty penalties.
Early Repayment
If you can't get full flexibilty look
for a loan that allows for Early Repayment.
Most people end up wanting to repay their loan sooner than they have to - particularly when they see how much it's costing them in interest. But many lenders will charge extra for this.
Look for shorter repayment periods.
The amount to repay every month may look a lot more but it'll cost you a lot less in the long run.
To see this, get the lender to show you the total amount you'll have to repay for various periods.
The small print
...is where all the terms and conditions of the loan are
confirmed. (It's in the Credit
Agreement).
Read it carefully and ask any "stupid questions" about the terms of the loan you feel like. Go ahead. Make some up just for a laugh. Your lender makes enough money. Keep them on their toes.
Look for the lowest APR.
These are what the best buy schemes refer to. But bear in mind that often they're only available to those with the best credit rating.
Often they're really just a way of the lenders luring you in so that they can offer you another, higher rate and you're so bored with the whole thing that you accept it. See Beware the Headline Interest Rate
Always shop around. Compare three quotes.
Use a broker.
These are firms who specialise in searching the market to get you the best deal.
Watch out because some of them will only deal with a limited number of lenders, usually the ones who give them the best commissions. To make sure they do find you the best deal, compare the quote with others.
Beware Arrangement Fees.
Some lenders charge these. Avoid them unless the lender can prove the loan will be cheaper overall than others ie loans which don't charge fees but have a higher interest rate. These will be reflected in the APR.
Be careful of the Headline Interest Rate.
This is the interest rate you'll see in the adverts. The huge type shouting "0%". Sure thing. Ignore it.
This is one of the tricks of the trade used by the lenders. Always compare loans using the APR.
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