Lending Fees
Depending on the type of loan a consumer has been approved for, they might incur certain fees as part of the loan’s terms. Such fees include:
Interest fees- this is simply the sum of money included in each monthly payment as a percentage of the total loan. For example, if you borrowed $5,000 and the interest rate is 10.4% over a three-year term, your interest fee would be approximately $23.39.
Origination fees- these are fees that some lending companies charge to process the loan application. They typically equal between 1% and 6% of the loan amount.
Penalties- these fees can occur in cases where the borrower’s payment is late, or in cases where the borrower pays off the sum of their loan early.
Consumers need to conduct careful research when seeking a personal loan. Reviewing the terms listed and being certain that they’re understood and agreed upon can improve the odds of borrowers satisfying the terms. With this, consumers are more able to fully pay it back with no surprises along the way.
