Quick Tips on Banks, Lenders, and Credit Card Companies

Banks and lenders use your credit score to calculate what interest rate they can give you. Your credit score affects your interest rate and your interest rate can impact your total cost of a loan.

In order to secure the lowest interest rate you qualify for you should first check your credit score and then compare APRs (annual percentage rate) lenders advertise to find the lowest one available to you.

When you apply for a loan always choose a lender and look at their interest rate, the amount you’re borrowing and how long it will take you to pay it off.

When looking at the APR, always remember that it is the annual percentage rate you will be charged in addition to the amount you borrowed for the duration of the loan all lenders are required to show you the APR before you take out a loan, so you can compare different loan offers, and the APR is affected by your credit score. A higher credit score means that you will have a lower APR and, a lower credit score means a higher APR in which you will be paying more throughout the year.

Every lender is required by law to show you the APR that you will be charged before you are approved for the loan.

If you remember the true cost of credit, you should have any surprises when taking out a loan. Most people get scammed or don’t realize what they are actually paying because they don’t understand how lenders, credit scores, and APRs work.