Opt for an FSA regulated lender
When you are looking to take out a loan there are a number of things that you need to consider. Not only do you need to think about what type of loan to go for and how much you need to borrow but you also need to think about which lender to choose for your loan.
It is important that you get the right lender for your loan, as otherwise you could end up paying way over the odds and could find yourself having problems with the lender as time goes on. You should therefore check a number of things when looking at different lender to make sure that you get a lender that is reputable and fair.
One of the main things that you need to look for in a lender is that the company is FSA authorised and regulated. The FSA, or the Financial Services Authority, is the UK’s financial regulator, and although its board members are selected and appointed by the treasury the agency is a non-government agency and is funded by the financial industry. The role of the Financial Services Authority is to provide guidelines and regulations for FSA regulated companies to follow. The FSA regulates a range of financial services and sectors.
The reason why you should make sure that the lender you use is FSA regulated and authorised is because this will provide you with valuable protection as these lenders will have to adhere to the rules and regulations set out by the FSA. One of the purposes of the FSA is to protect the consumer and ensure that financial companies act fairly, which means that if you opt or a lender that is FSA regulated you benefit from the protection of this agency and reduce the risk of ending up with a lender that engages in unfair practices.
When you are looking for a loan you should check the website or the literature of the lenders that you are considering, and it should state that the company is FSA authorised, although if you are in any doubt you should ring and check with the lender. If you can see that the company is FSA authorised you will have the peace of mind that comes with knowing that you have some degree of comeback if you feel that you are the victim of unfair practice by the lender.
There are also other things that you should look for when selecting a lender. Try not to fall for gimmicks or get carried away by special offers – make sure that you look at the bigger picture. You should be able to see what the typical APR charged by the lender is rather than being told what their rates start from. No matter what rate the lender starts from the majority of borrowers will get a higher rate, which is the typical rate, and this is what you should be looking at when comparing interest rates on different loans from different companies.
The easiest way to find a wide choice of lenders and compare both the interest rates and whether or not they are FSA registered is to go online and look at different lenders’ websites. You can do this with ease and convenience from the comfort and privacy of your own home.
Tom Smith
4th November 2007
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