If you have gone online to search for how to get a loan in Nigeria, you are not alone. In this article, I will show you how to get a loan in Nigeria, so that you can know what to expect beforehand to avoid any surprises.
There are many reason you may want to consider taking a loan and to be honest, they are all valid. It could be you need to get over a financial hump, cover an unexpected expense, or make a big-ticket purchase.
It can also be a more personal reason like medicals, wedding, home improvement or even to consolidate an existing loans.
Apply for a quick IPPIS and REMITA Loan
How to get a Loan in Nigeria
- Know your repayment capacity.
- Check your credit history.
- Consider a collateral or guarantor.
- Decide the type of loan.
- Be sure of the interest rate.
- Pick a lender and apply.
If you’ve decided to take a loan, follow these six steps to apply.
1. Know your Repayment Capacity
The most important thing your lender will consider is your repayment capacity. This will likely vary with different lenders as each have their risk appetite and criteria for determining the value.
A quick way to know your loan repayment capacity is by dividing your total income by 3. The value you get is what most lenders will agree to take from you as a monthly repayment.
If you feel the value is too high for you to repay, let your lender know this before you proceed.
2. Check your Credit History
When you take a loan, your lender is obligated to submit the loan details to the Credit Bureau of Nigeria, most people don’t know this.
Your credit history is no secret, so when a lender ask for your loan history don’t be tempted to lie. Lying about your credit history may show to your lender that you have a character flaw.
Most people lie because they think, if the lender know about their existing loan, they may turn down their application. Based on each lender risk apetite, they may still consider you depending on the number of your existing loans.
As a matter of fact, the more you have borrow and repayed, the better your chances of getting a loan.
3. Consider a Collateral or Guarantor
If you still want to stand a better chance of getting a loan, regardless of your credit history and your repayment capacity, then you may need to provide a collateral or guarantor.
For a lender to accept your collateral, it has to be able to retain two or three times the value of your loan amount after your intended loan duration.
Also, a lender will not accept a collateral that is overly valued than your loan amount. For context, a house valued at 70 million naira would not be accepted for a loan of 1 million naira.
If you are providing a guarantor instead, your guarantor have to show proof of capacity to repay your loan in case of default, along with signed agreement to do it.
4. Decide the Type of Loan
Different lenders have loan products that have been customised based on their risk appetite, requirements, loan tenure and their target customers.
Common loan types you will find include payday loans, federal workers loan, device finance loans, business loans and several others. Check out each loan product carefully and keep an eye for their requirements before you apply.
5. Be sure of the Interest Rate
Knowing how much you are paying back, will help determine if you are still within your repayment capacity. Never start a loan if you dont know the interest rate.
Compare the interest rate and your repayment amount with other available loan products you qualify for, before you proceed with your loan application.
6. Pick a Lender and Apply
Now that you are ready to apply, dont forget to research the lender. Make contact and ask questions you wish to know. You can ask for explanations on the type of loans, the interest rate and requirements to apply for the loan.
It will be safe to also know the loan company policies on collateral submitted, repayement methods, missed repayments and data privacy.
Apply for GTI Microfinance Bank Loan
You can begin your loan application with GTI Microfinance Bank on our online platform SAHA by GTI. We have multiple loan products that I trust will fit your profile and loan needs.
To get started, open a fast account now on SAHA by GTI. To perfect your account opening on SAHA, you will need to complete your KYC information.
The KYC documents to upload includes;
- Your passport photograph or selfie
- Your Government issued Valid ID card.
- A recent utility bill that is not older than 3 months (it could be a electricity bill or waste bill)
- A picture of your signed signature
After you have submitted your KYC, it will be reviewed buy our internal credit officers. If you do not receive a response in less than 60 minutes, contact SAHA customer support on 0700 2255 7242 or WhatsApp for a faster response.
Once you are approved, Proceed to apply for your loan.
Required Documents for a Loan
When you get all the documents needed for your loan application, it will help you get a quick response and avoid any back and forth on your loan application process. The documents you may need include the following:
- A Valid government issued identity card, such as a driver’s license, National ID card, or International passport.
- Proof of residence, such as a utility bill (electicity bill or waste bill) that is not older than 3 months. The utility bill must show your current home address to be approved for use,
- Proof of income, such as bank statements, or your payslip from work. For business owners that do not have a bank statement, a legder book of day to day sales of your business may suffice.
- For salary earners, you may need a proof of employment, such as a employment, confirmation or deployment letter.
- Employer’s information, including the company name, your manager’s or HR name and the phone number.
- A recent passport photograph or a selfie of yourself depending on the device you use for the application.
Are you creditworthy?
Your creditworthiness is determined by several factors including:
- – Your repayment history for any previous loan
- – If you have another existing loan with another bank or lending company
- – Your income compared to the loan amount and repayment duration
- – Your guarantors’ capability of taking responsibility for your loan
- – Your creditworthiness is important because it will determine whether you get the loan you applied for.
But that’s not all.
The more creditworthy you are, the better it is for you because your loan application is approved faster compared to a poor creditworthy person.
