Guide to getting a loan in a credit crunch

It's no secret: getting a loan is more difficult than it used to be. Ever since the sub-prime mortgage crisis sent shockwaves around the global economy, lenders have been keen to protect themselves from taking on any more 'risky' business. As a result, lending criteria is tighter, and interest rates have arguably stayed higher than they would have under normal circumstances.

With that in mind, it pays to make sure you are well prepared before applying for a loan. Here are a few quick tips for improving your chances of getting a loan.

Getting a loan: quick guide

Plan your loan in advance
Before you start, you'll want to make a note of how much money you want to borrow. It's very difficult to work out how much your monthly payments are likely to be on your own, since the interest is often calculated on a daily basis – but there are plenty of 'loan calculators' online which help you to work out a rough amount you will be paying each month, based on the total amount, the repayment period and the interest rate.

Once you've established what your monthly payments will be, it's important to ensure that you are able to afford them over the whole period.

Check your credit history

Making sure your credit history is in the best possible condition is very important. Even if you think you have a shining credit history, it won't hurt to obtain a copy of your credit report and look for anything that has been entered by error, old accounts that have not yet been listed as settled, etc. If your credit history is less-than-perfect, it could be even more important that you iron out any inaccuracies.

You can obtain your credit report from any of the major credit reference agencies – Equifax, Experian and CallCredit.

Get advice from an expert
Going it alone in the search for a loan can be a long process. Unless you're willing to settle for the first loan deal you come across, you'll want to make sure you have access to all the best deals, with as little effort as possible.

That's where an expert loans adviser comes in. Your loans adviser will have access to an extensive panel of lenders, most of whom should offer a number of deals to suit people in various financial situations.