Weigh Your Options When Deciding on Financial Products

Nowadays, financial products are a dime a dozen, with companies whose primary business does not include financial products are now offering financial services. Take Google, Walmart and Office Depot, for example. These brands are household names. They are, however, not known for their expertise in financial services, but they have started to venture into microloans by offering business loans in the range of $5,000 to $25,000. Google has already launched a business credit card for selected clients that can be used to purchase Adwords services.
With so many financial products and services to choose from, choosing the right service, product, or provider can be confusing and difficult. Here are some things to consider when deciding on financial products.

Google, Walmart, and Office Depot may be trusted household names, but note that these brands are not actually service providers. Instead, these brands partnered with a financial institution. Google’s credit card, for example, is issued by World Financial Capital while Walmart and Office Depot are partnered with Walnut Creek. It is important to consider who the actual service or product provider is. Find out if the financial institution is trustworthy by doing a background check. The financial institution will be doing a background check on you so it’s only fair that you do the same.

Interest rates and fees should always be a major consideration. Interest rates are usually tied to a lot of factors like credit scores and loan size. It is important to seek out the best deal in order to minimize costs. Be wary of financial institutions that offer too-good-to-be-true rates because chances are, they are. You can choose from loans with fixed interest rates or loans with variable interest rates. Both have their own set of advantages and disadvantages.

Repayment schedules are another thing that must be taken into consideration when choosing the right financial product. Especially for business owners, choose a repayment schedule that matches your business cycle. Be sure to schedule payments when there’s incoming cash flow. Some repayment schedules have a fixed amortization date while other loan products, like the merchant cash advance lets you pay when you can.

Not all loans are created equal. There are loans that cater only to a specific market. For example, there are small business loans for people with bad credit, working capital loans, a business line of credit, ACH loans, and the list goes on. Some loans cater only to a specific industry or a specific purpose such as restaurant business loans. Make sure to apply for the loan that fits you and your business. While there is no specific formula to finding the best financial product, service, or institution, there is no need to go about it blindly. Research all of the lending companies and the products they offer. It is always best to find a trusted lender with the Better Business Bureau and one that has a good reputation in the business loan industry.