In the world where credit surrounds the consumer, it’s easier than ever for consumers to accrue debt. If you are not financial aware of how credit work or what to look out for when opening a loan, a simple line of credit can haunt a consumer for decades. To help anyone interested in opening a personal loan in Portland, in this article, we are going to explore the role of you credit score when opening a personal loan and how to pick the best personal loan. This way, you too can avoid finding yourself in years of debt, after you have used the loan.

Now, if your credit score is lower than the national average, chances are, lenders will view you as a risk. In other words, based on your credit score, lenders will charge a higher interest rate and fees, both of which are meant to motivate credit holders to pay their bills on time. However, with higher interest comes a greater loan cost. So, it’s vital that you take the time to focus on improving your credit score before you begin to pick any personal loan lender.

How to Pick the Best Personal Loan in Portland

Once your credit score is established and is in-or-around the national average, or higher, before you can apply for just any personal loan, it’s important to learn how to pick the best personal loan. In Portland, Oregon, the Beaver capital city is full of different personal loan lenders. So, to better help local Beavers, we have a few tips on how to pick the best personal loan.

1. Red Flags

On your journey to picking out the best personal loan in Portland, it’s vital that you know what red flags to look out for. If a lender is promising guarantees or promises on interest rates or paying off a loan, these are companies you need to avoid. On top of this, when doing research, if a company has numerous bad reviews or biased positive reviews, this is a red flag as well.

2. Interest Rates

With so many different institutions in Portland, it’s important that residents take the time to compare interest rates between different companies. This is the best way to ensure that you are securing the best possible personal loan offer. Also, be sure to find a company that is offering a fixed interest rate, not variable.

3. Loan Terms

Our last tip in picking out the best personal loan in Portland is to be careful of loan terms. There are specific lenders that only offer short-term or only offer long-term loans. Short-term loans are great for individuals that can handle higher monthly payments and wish to pay off a loan quicker. On the other hand, long-term personal loans are great for individuals that need lower monthly installments; however, a longer loan means greater loan costs.

 

Are Payday and Title Loans the Same as Personal Loans?

No not really. A payday loan, or cash advance, is easier to get and has a shorter term(unless it’s a longer installment option) but higher fees and much higher interest than personal loans. The same is true for title loans with the addition of your car being used as collateral. Be very cautious with these types of loans.