Steps To Getting The Best Loan (Lån) For You

Steps to Getting the Best Loan (Lån) for You
Steps to Getting the Best Loan (Lån) for You

People get into a financial bind from time to time and one way of getting out such situations is by taking out a consumer loan. This loan can either be secured or unsecured. Secured loans are backed by security while the unsecure ones are not.

Secured loans give the borrower the edge to negotiate better terms and rates for their loan. The value of the collateral assures the lender that they will be duly repaid and in the event that the consumer cannot repay, the asset will be used to recover the amount owed.

Secured loans include mortgage and auto loans while unsecured ones include student, medical and credit card loans. In this article, we will discuss some of the basics of consumer loans, requirements for qualification and how to get the best option for you. 

Basic Requirements for Consumer Loans

There are different forms of consumer loans and we have stated them here. All these loans have almost the same requirements except for some variations depending on the lender and the type of loan.

The basic requirements include the following:-

  1. Must be of legal age – The globally accepted legal age is 18 years. But most banks in Norway will hesitate to give an 18 year old loan without collateral. The most widely accepted age is between 23 and 25 though some banks make exception for 20 to 23 year olds.
  2. Must have verifiable income – Banks don’t give out credit unless they are certain that the borrower is capable of repaying. One way of ascertaining this is by checking the applicants’ means of income. People in paid employment are expected to present their pay slips (about 3 months prior to the application) while self-employed folks are required to present their businesses’ statement of account.
  3. Proof of Residence – The applicant must present proof that they have lived in the country for a minimum of 3 years. They must also present proof that they have paid tax for those 3 years. This is especially for non –indigenes of Norway.
  4. Proof of Citizenship – Norwegian citizens must present proof of citizenship
  5. BankID – This identification is mostly required for same day loans and similar credit facilities.

Types of Consumer Loans

The two broad categories of these types of loans like we mentioned are unsecured and secured loans. You can visit billigeforbrukslå to understand all the differences between the two categories. Under these two categories, we have the following:-


These are credit advance given for the purchase of a home or real estate. The minimum number of years for the repayment of this type of credit facility is 15 years while the maximum is 30 years. It can come with a fixed rate interest or an adjustable rate interest.

The fixed rate interest means that the interest that the borrower has to pay is fixed for the whole period while the adjustable rate means that the interest can be changed at some point in the repayment duration. 

This is a secured loan and the home or property purchased with the money borrowed is usually the collateral. This therefore means that if it so happens that the borrower defaults, the house will be repossessed and used to offset the debt.

There’s so much more about the terms and conditions for this credit facility, so you need to research these before you set out to apply for it or sign any loan agreement document.

Auto Loan

This facility as the name implies is given to enable the borrower to purchase a car. Some lenders include all forms of automobile in this type of credit. The repayment duration can be anywhere from 2 years to 7 years while the interest is determined by a number of things.

Personal Loan

This is one of the most flexible types of consumer loans. This is because it can be used for any personal expenditure as determined by the consumer. Although some lenders will ask for the purpose of the loan, the reason given is not binding on the borrower.

This form of credit is most often short term and the interest rate is most times higher than the first two types that we discussed. It is an unsecured loan because the borrower does not need to put down any security for the sum borrowed.

Other forms of consumer loans which are not secured are students and medical loans.

Steps to Getting the Best Loans

Getting the best loan for you will not just happen; you need to do some research to find out which one works best for you. Here are some things that you can start out with:-

Compare Loans

Check as many offers as possible to find out which one will suit you the most. You can either check these offers yourself or engage the services of a loan agent. The latter option will guarantee you a stress free and time saving process. But if you have the time and don’t mind the work, you can do the comparison shopping yourself.

When you compare offers, remember to use the same parameters. For example, if you are comparing mortgage offers, compare options that have the same interest rate, repayment duration and same amount. That is the only way to get the right comparison.

Use Prequalification

Prequalification helps you to get an estimate of the total cost of the loan that you want to take out. This is a step further in your comparison shopping but you have to know how to go about it.

Applying to many lenders can affect your credit score because whenever a check is carried out on your record, it lowers your score. So having too many of these checks is not good for your credit history. But you can mitigate this risk by asking lenders for prequalification.

This process allows you to know whether you will be approved for a loan and all that the loan entails without a hard inquiry into your credit history. With this process, you can compare offers to pick the best for you. Check out this article for more information about prequalification.

Select the Best Option

After you have compared as many offers as possible, the next thing is to apply for the offer that suits you best. Find out all the necessary documents required and get them ready before you even start the process. After that, you start the application process.

Sign the Loan Agreement

The final step in your application process is when the bank approves your application and sends you the agreement document. Ensure that you read the fine print so that you know what you are appending your signature to. In countries such as Norway, you use your BankID to sign off on a loan agreement.

The lender will disburse the funds within the stipulated time stated in the terms and conditions after you sign the agreement documents.


We have discussed some basics about getting the best consumer loan for you. We encourage you to bear these tips in mind so that you can make an informed decision whenever the need arises for you to engage a credit facility.