Read Related: 10 Factors That Affect Your Mortgage RatePrinciple is the amount of money that the item you want to buy actually costs. It seems silly, but the more expensive the item is the less people seem to know about how much it actually costs. I can’t tell you know many times I’ve asked someone how much the principle on their car loan is only to receive a blank stare. Be choosy and compare prices of similar items from different sellers.
Taking a loan is a huge deal, no matter the dollar amount. It’s important that we make sure to compare the same loan deal from at least three different financial institutions to make sure that we’re making the best choice. We’re not begging for credit here. If one financial institution will give us a loan, there are several others that will as well. You get to choose which company will loan you money, just as the company gets to choose to whom it will loan money. We’re on equal footing, and we have to make the best decision possible. To make sure that we’re comparing apples to apples instead of apples to oranges, make sure you know the P.I.L. of every deal.