Economy
Understanding the Costs and Fees Associated With Online Personal Loans
Personal loans are offered by both traditional and online lenders. If you’re looking for a personal loan, understanding the costs and fees associated with it is one way to help determine if the cost of the loan outweighs the benefits.
There can be many benefits to taking out an online personal loan rather than a traditional one, but there could also be some drawbacks as well. Before you borrow money from any company or lender, it’s important that you receive all of your information as well as understand what you’re signing up for in order to make the best decision possible for yourself. The following article will provide information on how much traditional and online personal loans typically cost so that you can know exactly what to expect before you decide to take out a personal loan.
Interest Rates
One of the most common fees associated with a personal loan is the interest rate, which can greatly affect how much money you have to pay back overall. Traditional lenders typically have higher interest rates than online companies as well as those from some smaller local stores. In addition, some traditional lenders may require that borrowers maintain a specific credit score or certain monthly income in order to qualify for their loans.
This can be true of many different types of lending institutions including both banks and other financial businesses such as credit unions and savings and loans associations. If you don’t already have an idea of what your credit score might be, it’s usually a good idea to check out this guide to personal loans ahead of time in order to ensure that you can be approved for a loan before you apply. It helps to know which loan options you will be comfortable with regarding the amount you loan and paying back.
While online lenders may offer lower interest rates for personal loans, they aren’t always guaranteed and could potentially change depending on certain factors such as your credit score or how much you borrow. If your credit score is below average, it’s also possible that you won’t even qualify for an online loan at all as many of them require a minimum credit score in order for borrowers to receive approval. It’s important to consider the possibility of this type of scenario if you need money fast and don’t have very good credit.
Application Fees
Along with the interest rate, you should also be aware of the application fee, which is a fee applied when you first apply for your loan. For example, many traditional lenders will charge borrowers an application fee regardless of whether or not they are approved for a loan in order to cover administrative costs associated with checking their qualifications. Institutions offering installment loans for bad credit may or may not have application fees collected, but an origination fee may be charged.
In addition, unlike mortgage origination fees, which are usually negotiable, it isn’t the case with most personal loans. This doesn’t mean you should avoid getting this loan. Some loans with origination fees have low APRs, which can be advantageous for you, so review your options first by pre-qualifying for multiple loans if possible.
While online lenders usually don’t charge an application fee to borrowers, there are some institutions that do. If you can’t afford to pay upfront costs in addition to your monthly payments throughout the life of your loan, it’s important that you find out what fees are required before choosing where to take out your money from. Some lenders may only require that applicants pay their interest rate but others could require additional expenses such as processing fees and possibly even insurance premiums for covering the loan itself.
Prepayment Penalties
If you need to pay back your personal loan before the standard repayment term is up, you could potentially incur fees if you’re unable to do so beforehand. This fee is known as a prepayment penalty, which some lenders may require borrowers to pay in order to compensate for business expenses that were incurred during the processing or administration of an account. Borrowers would only be responsible for this fee if they are unable to make their regular payments without defaulting on the loan entirely. If an individual exceeds their credit limit on any type of credit card, it may trigger potential penalties such as this one.
There are many different types of lending institutions out there and not all of them will charge prepayment penalties. If you know that you’ll be able to make your payments on time, it’s best to shop around as much as possible before deciding which company to take out your loan from.
Other Fees You Should Know About
Credit Unions or Other Lending Institutions
Although many traditional financial institutions such as credit unions may offer very low rates and fees for borrowers, they aren’t always available for everyone and can potentially have restrictions depending on your location or certain qualifications that must be met. For instance, some credit unions only serve members who meet their organization’s requirements such as having a specific job title or living in a specific area.
Loans with Guarantor
If you apply for a personal loan through a company that requires a guarantor in order to approve your application, be sure to find out what they’ll charge for this service. In some cases, companies may also request additional fees from the co-signer who vouches for another individual’s ability to repay their debts on time.
Stopping Payment on Check Loans
If you took out a loan against your upcoming paycheck, it’s important that you know how much it will cost if you ever need to stop payment on a check before it has been cashed by the lender. Most institutions will require borrowers to pay an amount equivalent to at least one full cycle of interest regardless of whether or not the check was actually deposited.
Online lenders are beginning to rise in popularity over traditional lending institutions because they typically don’t require borrowers to pay the same fees or interest rates that many brick-and-mortar companies do. Although online loans may come with lower costs, it’s important that you factor in all fees before choosing where to apply for your loan to ensure that the rate you’re offered is fair for your financial situation.
If you feel like you would be more comfortable speaking with someone directly, there are also many different places you can go in order to apply for a personal loan in person. Even if you’re certain an online lender will approve your application, it never hurts to check out what other options are available so you can compare costs and determine which one would be the best solution to meet your needs.
By Adedapo Adesanya
Food Concepts Plc neutralized the gains recorded by three securities, returning the NASD Over-the-Counter (OTC) Securities Exchange into the negative territory with a 0.27 per cent loss on Thursday, December 4.
Yesterday, the share price of the parent company of Chicken Republic and PieXpress declined by 34 Kobo to sell at N3.15 per unit compared with the previous day’s N3.49 per unit.
This shrank the market capitalisation of the OTC bourse by N5.72 billion to N2.136 billion from N2.142 trillion and weakened the NASD Unlisted Security Index (NSI) by 9.57 points to 3,571.53 points from 3,581.10 points.
Business Post reports that Central Securities Clearing System (CSCS) Plc went down by 50 Kobo to N38.50 per share from N38.00 per share, FrieslandCampina Wamco Nigeria Plc gained 29 Kobo to sell at N55.79 per unit versus N55.50 per unit, and Geo-Fluids Plc added 5 Kobo to close at N4.60 per share compared with Wednesday’s closing price of N4.55 per share.
Trading data indicated that the volume of securities recorded at the session surged by 6,885.3 per cent to 4.3 million units from the 61,570 units posted a day earlier, the value of securities increased by 10,301.7 per cent to N947.2 million from N3.3 million, and the number of deals went up by 146.7 per cent to 37 deals from the 15 deals achieved in the previous trading session.
At the close of business, Infrastructure Credit Guarantee Company (InfraCredit) Plc was the most traded stock by value on a year-to-date basis with the sale of 5.8 billion units for N16.4 billion, trailed by Okitipupa Plc with 170.4 million units worth N8.0 billion, and Air Liquide Plc with 507.5 million units valued at N4.2 billion.
InfraCredit Plc also finished the session as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Dipo Olowookere
The upward trend witnessed at the Nigerian Exchange (NGX) Limited in recent sessions continued on Thursday as it further improved by 0.10 per cent.
This was despite investor sentiment turning bearish after the local equity market ended with 23 price gainers and 28 price gainers, indicating a negative market breadth index.
UAC Nigeria gained 10.00 per cent to finish at N88.00, Morison Industries appreciated by 9.94 per cent to N3.54, Ecobank rose by 8.53 per cent to N36.90, and Coronation Insurance grew by 8.47 per cent to N2.56.
On the flip side, Ellah Lakes depreciated by 10.00 per cent to N13.14, Eunisell Nigeria also shed 10.00 per cent to finish at N72.90, Transcorp Hotels slipped by 9.95 per cent to N157.50, Omatek shrank by 9.23 per cent to N1.18, and Guinea Insurance dipped by 8.46 per cent to N1.19.
Yesterday, the All-Share Index (ASI) went up by 152.28 points to 145,476.15 points from 145,323.87 points and the market capitalisation chalked up N97 billion to finish at N92.726 trillion compared with the previous day’s N92.629 trillion.
Customs Street was bubbling with activities on Thursday, though the trading volume and value slightly went down, according to data.
A total of 1.9 billion stocks worth N19.2 billion exchanged hands in 23,369 deals during the session versus the N2.3 billion valued at N21.0 billion traded in 21,513 deals a day earlier.
This showed that the number of deals increased by 8.63 per cent, the volume of transactions depleted by 17.39 per cent, and the value of trades decreased by 8.57 per cent.
For another trading day, eTranzact led the activity chart with 1.6 billion units sold for N6.4 billion, Fidelity Bank traded 31.0 million units worth N589.3 million, GTCO exchanged 28.3 million units valued at N2.5 billion, Zenith Bank transacted 27.1 million units for N1.6 billion, and Ecobank traded 21.9 million units worth N744.3 million.
By Adedapo Adesanya
The Naira marginally depreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, December 4 amid renewed forex pressure associated with December.
At the official market yesterday, the Nigerian currency lost 0.01 per cent or 18 Kobo against the Dollar to close at N1,447.83/$1 compared with the previous day’s N1,447.65/$1.
It was not a different scenario with the local currency in the same market segment against the Pound Sterling as it further shed N15.43 to sell for N1,930.97/£1 versus Wednesday’s closing price of N1,925.08/£1 and declined against the Euro by 20 Kobo to finish at N1,688.74/€1 compared with the preceding session’s N1,688.54/€1.
Similarly, the Nigerian Naira lost N5 against the greenback in the black market to quote at N1,465/$1 compared with the previous day’s value of N1,460/$1 but closed flat against the Dollar at the GTBank FX counter at N1,453/$1.
Fluctuations in trading range is expected to continue during the festive season as traders expect the Nigerian currency to be stable, supported by intervention s by to the Central Bank of Nigeria (CBN)in the face of steady dollar demand.
Support is also expected in coming weeks as seasonal activities, particularly the stylised “Detty December” festivities, will see inflows that will give the Naira a boost after it depreciated mildly last month, according to a new report.
“As the festive Detty December season intensifies, inbound travel, tourism spending, and diaspora inflows are expected to provide moderate support for FX liquidity,” analysts at the research unit of FMDA said in its latest monthly report for November.
Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450 next week, buoyed by improved FX interventions by the apex bank.
Meanwhile, the crypto market was down as the US Federal Reserve’s preferred inflation gauge, core PCE, likely rose in September—moving in the wrong direction. However, volatility indices show no signs of major turbulence.
If the actual figure matches estimates, it would mark 55 straight months of inflation above the US central bank’s 2 per cent target. The sticky inflation would strengthen the hawkish policymakers, who are in favour of slower rate cuts.
Ripple (XRP) depreciated by 4.5 per cent to $2.08, Solana (SOL) went down by 3.8 per cent to $138.11, Litecoin (LTC) shrank by 3.1 per cent to $83.23, Dogecoin (DOGE) slid by 2.5 per cent to $0.1463, Cardano (ADA) declined by 2.1 per cent to $0.4368, Bitcoin (BTC) fell by 0.9 per cent to $91,975.45, Binance Coin (BNB) crumbled by 0.9 per cent to $899.41, and Ethereum (ETH) dropped by 0.7 per cent to $3,156.44, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
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