The fine art of loan shopping

One might see the term "fine art" associated with finding the perfect loan and dismiss it as hyperbole. OK, it is exaggeration, but not as much as you might think. It requires craftiness, research and patience to successfully complete this task. Today, we'll go over simple best practices for obtaining the right loan, and also examine how alternative credit can help.

"Finding the ideal loan requires a combination of preparation, research and craftiness in the moment."

Shopping around is key
The Federal Trade Commission recommends testing the waters with a number of different lenders. See what the usual suspects of banks and credit unions have to offer, then take a look at online or alternative lenders.

You can also enlist a broker to be conduit between you and a lender. While brokers work for fees not included in the eventual loan's closing costs, they won't be loyal to one institution over another. They should look out for your interests first.

Crunch the numbers
Percentages will rule everything around you while loan shopping. Ask about annual percentage rates, fixed or adjustable interest, caps on rate increases as well as points and fees, as recommended by the Consumer Finance Protection Bureau. Also, inquire about special financing, like VA or FHA loans, if you meet the criteria. 

The credit factor
The Fair Credit Reporting Act guarantees that lenders must review anything you submit as credit, including alternative credit data, though they aren't obligated to accept it. However, bringing in proof of steady income alongside data on timely rent, utility and other major everyday payments from PRBC could combine to be everything you need. 

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