Do you know that you can negotiate your loan terms? Yes, you heard that right. From interest rates, borrowing limits, or even the loan’s maturity, these things are negotiable as long as you have a good standing with your lender and excellent creditworthiness. However, if negotiating is not your strong suit, we will teach you some good tips on negotiating properly with your lender.
But take note that the negotiation outcome won’t always come positively even if you use these tips. However, they give you a good chance of landing better terms for your loan. You just have to play your cards right.
With that said, here are some tips on how to negotiate with your lender for your loan.Do Your Research
You can’t negotiate properly with your lender if you don’t do proper research. But, on the other hand, if you don’t, there’s a huge chance that you’ll fail miserably and will even get on bad terms with your lender.
That said, one thing you can do is to know if you have factors that can help you land better terms for your loans. Even if you can negotiate properly, if you don’t have something in you that might help with your case, it’s all for naught.
Also, through proper research, you’ll know the terminologies needed within the discussion. It’s also essential to find out about the aspects of the loan, like its restrictions and price. Not only that, but you should also research other loan products like CreditNinja fast personal loans. With this information, you can now say that you’re in the same ball game with your lender.Speak with Confidence
It might not be a job interview, but it’s pretty much the same because of the pressure. With that in mind, you won’t get that far if you get nervous. But at the same time, you can’t go in without the proper knowledge.
That said, it’d be far better if you and your lender understood each other easily. Speak confidently and clearly about what you want from your lender. Being clear with what you want will give you an edge at the negotiating table as you’re not giving your lender a chance to contest other choices for you.Understand Your Alternatives
Don’t hastily agree to anything that your lender offers you. Instead, you should ask questions and reference your other lenders’ options. Remember, lenders don’t like to lose a client, so they will try their best to keep your business.
For example, if you give them a hint that you’re looking for other personal loan options from other lenders, they will try to make their pitch a better choice in your eyes. But as we said, it should be subtle as you’re not trying to intimidate them here. Doing so will make a risk, and the negotiations will be over instantly.Focus on Prepayment Charges
If you’re planning to pay the loan early, then negotiating for the prepayment charges is essential before you get the loan. Most lenders require you to pay a prepayment charge if you decide to pay your loan early. This is because paying your loan early will disrupt their cash flow from the interest for the duration of your loan.
That said, if you’re planning to do this, negotiating for it will give you and the lender flexibility when the situation arises. And if you’re good enough, you can negotiate for a lower prepayment fee when you decide to pay your loan fully when you get the chance.Always Trust Your Gut
As a borrower, you should know that if you have a good credit score, clean credit history, or have access to valuable possessions that can count as collateral, practically everything can be negotiated. Everything is on the table, from the interest rate, prepayment fee, annual fee, processing fee, etc. However, if you’re planning for a secured loan, you should always think more about them, especially if you’re putting up one of your valuables as collateral.
Think carefully before pledging your house, car, or anything of value before you sign that contract. But most of all, you should always check first if you can repay that loan in full before you pledge anything because if you can’t, then you can say goodbye to your house, car, or anything you put up for collateral. So before going for a secured loan, you might want to try your best for an unsecured one.Final Words
Just because you can negotiate for a loan doesn’t mean you have to do it unprepared. The tips discussed above are good tips to guide when negotiating for a loan
But at the end of the day, it’s up to you to discuss what you want from your lender. If you want to be successful, ensure you’re reasonable and have the assets that can get you on equal terms with your lender.