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Personal loans come with various charges that potential borrowers must be aware of. These are the most common fees associated with personal loans:
1. Origination Fee: it is a charge made by the lender for processing the loan application. The fee is usually a certain percentage of the loan amount and will be subtracted from your loan before it gets disbursed.
2. Application Fee: Some lenders may require you to pay upfront fees for processing your loan application. However, not all have this requirement so you should compare different alternatives.
3. Prepayment Penalty: Some loans carry prepayment penalties—charges accruing in case one pays off their debt ahead of schedule. To find out whether or not the loan you are contemplating carries this fine, check its terms because this can prevent you from reducing interest payments through early settlement.
4. Late Payment Fee: A late payment fee might be imposed if you do not pay your loan on time or submit an amount below what’s expected by the lender; hence, making him charge for your late payment. Maintaining such payments within stipulated periods helps avoid these additional costs.
5. NSF Fee: When you have insufficient funds in your bank account to cover a scheduled payment, the lender may impose non-sufficient funds (NSF) charges. Ensure that there’s enough money in the account to cater for paying back loans taken out during this period or any form of credit obtained during this period as well as other expenses incurred during that time frame.
1. Origination Fee: it is a charge made by the lender for processing the loan application. The fee is usually a certain percentage of the loan amount and will be subtracted from your loan before it gets disbursed.
2. Application Fee: Some lenders may require you to pay upfront fees for processing your loan application. However, not all have this requirement so you should compare different alternatives.
3. Prepayment Penalty: Some loans carry prepayment penalties—charges accruing in case one pays off their debt ahead of schedule. To find out whether or not the loan you are contemplating carries this fine, check its terms because this can prevent you from reducing interest payments through early settlement.
4. Late Payment Fee: A late payment fee might be imposed if you do not pay your loan on time or submit an amount below what’s expected by the lender; hence, making him charge for your late payment. Maintaining such payments within stipulated periods helps avoid these additional costs.
5. NSF Fee: When you have insufficient funds in your bank account to cover a scheduled payment, the lender may impose non-sufficient funds (NSF) charges. Ensure that there’s enough money in the account to cater for paying back loans taken out during this period or any form of credit obtained during this period as well as other expenses incurred during that time frame.
