What to pay attention to in the loan agreement?

There are some points to keep in mind when you want to arrange a loan contract. Always read the fine print. Here, often points are set which the borrowers easily overlooks but which could put them at a disadvantage.Check if any hidden charges are listed that may not have been previously discussed.Pay attention to whether the receipt of the loan is linked to the conclusion of a residual debt insurance for which additional costs are incurred.

Loan terms

Check if special repayment arrangements have been agreed. This is worth it if you know that you will receive a larger sum during the term. The loan terms are conditions that the lender has set in terms of financing. Only if the borrower agrees to these terms then the personal loan Philippines agreement is concluded. Usually, these are general loan conditions that are the same for each loan and are applied across the whole range of loan processing.Contents of the loan conditions are usually

  • Obligations and rights of the borrower
  • Obligations and rights of the lender
  • The right of withdrawal
  • The right of termination including notice periods

Loan approval: The decision

With the loan approval, the lender legally binds the borrower to receive the loan. You can find out whether your application has actually been approved after the potential lender has verified your creditworthiness.Normally, it will take two to fourteen days for you to receive a notification. If the bank has not contacted you after about fourteen days you should contact your contact person and ask for the status of your project.

The loan was granted

Once your loan has been approved you will receive the loan offer tailored to you personally.

  • Check the offer for all important aspects
  • Agree or reject the offer
  • Check all aspects in the loan agreement
  • Sign the contract and send it back to the bank
  • Hand out any collateral to the lender
  • You will be paid the loan to your account

The loan relationship comes into effect when you have signed the loan agreement with the declaration of consent and sent it back to the bank. So as long as you do not sign the contract you can contact your lender and possibly change various aspects.

Conclusion: The loan was rejected

It may well happen that a loan application is also rejected. Reasons can be

  • Bad creditworthiness information
  • No collateral
  • No regular income
  • Several loans that are paid off at the same time
  • Incomplete documents

In this case, be sure to check why your application was disapproved to change these factors. It is important to have a look into your credit score entries. These may already provide information about a bad credit rating. Possibly loans are here registered which have already paid off but have not been deleted.

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