Be a Responsible Debtor with These 3 Easy Tips

Loans can be very useful in a number of situations. A loan can be very good for your personal finances, simply because it offers leverage and the ability to acquire goods and services you need without spending any of your real money all at once. At the same time, it can also be harmful to your personal finances if you don’t manage the way you use loans properly.

The key to making the most out of the available financing options on the market is responsible lending. Here are the three simple tips you can use to be a more responsible borrower, as well as the benefits you can get from being one.

Be a Responsible Debtor with These 3 Easy Tips

Get Pre-Approved

Before making any big purchase using a loan, always get pre-approved for the financing option. Financial institutions see debtors who apply for a loan before actually making a purchase as being more responsible.

There are a number of additional benefits you will get to enjoy by getting a pre-approved loan as well. For starters, you have more time to negotiate a better deal on the loan. Banks are more than happy to provide you with better deals when you ask for them.

You also have more leverage when making the actual purchase. With a mortgage loan pre-approved, for example, you can offer the owner of the house instant settlement as opposed to asking the owner to wait for a couple of weeks while you apply for a mortgage. The instant settlement alone may land you a big discount on the house.


Never – and I do mean NEVER – go for the first loan offer you come across, no matter how desperate you are at the time. To get the best deal on a loan, you need to spend a bit more time and compare offers from multiple lenders.

Keep in mind that the financial market is really competitive. Not many responsible debtors are searching for a loan, so banks and financial institutions are competing fiercely for your business. Simply mentioning the fact that you are comparing loans and directly asking for a better deal will earn you discounts of up to 10% – sometimes more, depending on the loan.

Comparing also brings one extra benefit: you get to see the big picture before committing to the loan. You can review the loans’ cost structure before choosing one that is the most affordable or cost-efficient.

Know Your Lender

Last but certainly not least, always know who you are borrowing money from. Work with a reputable financial institution, particularly one with a long history of providing good financing to customers. If you use online resources such as Apply & Buy to search for available offers, you will also receive more information on the lenders.

The lenders will also try to get to know you better. Make sure you provide a valid and verifiable information when applying for a loan. This will not only strengthen your position as a responsible debtor but will also help speed up the loan application process substantially. You will get the financing you need in no time at all.

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