Most people who want to take out a personal loan, for example for the purchase of a car or a fridge, quickly think of the bank. In recent years, however, more and more people have opted not to go there, but with other lenders. The reasons are different: Trust in the bank may be damaged, people have tried it at the bank, but they refuse to provide the loan, or someone just needs some money quickly and no patience to wait until the bank has all has processed forms. An external lender offers a solution in these cases.
What is an external lender?
Just like banks, external lenders can lend money to their customers. This is done at a certain interest rate. External lenders are supervised by the government so that everyone can borrow money responsibly.
Advantages of borrowing without a bank
There are many benefits to borrowing your money from an external lender rather than the bank. For example, a loan is arranged faster with the external lender and you have your money sooner than with the bank. The interest rate is also often lower. That’s because more and more lenders are joining. Competition is becoming ever greater and interest rates are therefore becoming sharper.
Compare for a favorable loan
Of course you want to pay as little as possible for your loan. That’s why it’s best to compare different lenders. Pay attention to the following during your comparison:
- Interest on the loan Term of the loan and the monthly charges
You are likely to opt for the loan with the lowest interest rate, because that seems the cheapest. Looks like, because a loan with a low interest rate can sometimes have a very long term, which means that you are ultimately more expensive.
Also read the conditions carefully. These are not the same everywhere. For example, it states whether it is permitted to repay your loan earlier, or whether you will be fined. And whether your loan will stop in the event of death or not.
Reliability of the lender
Finally, it is very important that you check whether your lender is indeed reliable. There are illegal lenders active on the Dutch market. You can see from this whether you are working with a reliable party:
- The lender has a license from the Netherlands Authority for the Financial Markets (AFM). You can check this on the AFM website.
- When you take out a personal loan, an adviser may not charge any costs. If he does this then you are wrong.
It can be very beneficial to take out a personal loan with an external lender and not with the bank. Due to competition among lenders, interest rates are sharp and often things go faster. Make sure you take out a loan with a reliable party and look carefully at which loan best suits your situation.