• Questions to Ask Your Financial Advisor About Loans

  • by Katie Cramton
Financial Advice

Whenever finances come up many questions arise that can lead to even more questions and an overall feeling of confusion. Ultimately, the goal is to find something that is right for you. Whether you’re looking to refinance, purchase a new home, or get a reverse mortgage, navigating these roads can be challenging. Finding the right solution that fits your situation can be tough, so here are some questions you might want to ask your financial advisor – especially when you are considering applying for any type of loan.

Questions for Your Financial Advisor

One of the first things you should learn about your financial advisor is their credentials. You want a financial advisor who is credible and knows what they are doing. Additionally, you can ask them how long they have been in the business. It’s important that your financial advisor has the experience needed to give you the best possible solution for your situation. At this time, you may also consider asking them about the services they perform and how they get paid. If you know the answers to these questions, then you can better gauge how you would feel if you did business with them. All in all, it’s vital that you understand who your financial advisor is as a businessperson so that the relationship between you two will be a positive one.

Questions about Lending

If you believe a loan may be the right solution for you, a valuable subject to discuss would be the impact that a loan may have on your overall financial well-being (including debt, credit, overall borrowing potential, etc.). Additionally, it would be wise to bring up the process of receiving a loan. Given that loans can be confusing, it’s key that you understand everything that goes into receiving it. Granted, much of this will vary based on your lender of choice – however, there are best practices and warning signs that your financial advisor may be able to inform you about. Being knowledgeable may help you to avoid a poor experience with a bad lender. Along with these, it would be wise to ask questions about how to identify better options – in a competitive market such as this, you will likely have more options that you realize.

Questions about Finances in Retirement

One of the most important, if not the most important issue you want to discuss with your financial advisor is your plan for retirement. This is essential if you intend on refinancing your existing mortgage or taking on a different kind of debt in the near future. It’s key that you and your financial advisor are on the same page regarding any costs that you may need to know about, since this will often vary wildly between lenders. A question that seems to pop up during this type of conversation is how costs may be included in certain loan products. You want to know about any add-on costs and your all-in cost up front so that you can better judge if that lender’s solution is right for your situation. Another matter you will want to bring up is payment options. It’s best to find a payment plan that best fits your lifestyle and financial situation so you don’t have to worry about finding yourself in shallow waters. Payment options and rates may vary greatly between different types of loans, so make sure to learn what will or won’t be a good fit for you. This information will assist you in deciding if a loan will be able to help you with whatever monetary condition you may be in.

Concerns about Loans

The final subject you will want to discuss is any lasting concerns you may have. If you’re worried about debt in particular, make sure to put long-term plans in place so that you aren’t concerned about repayment. Your financial advisor could help you plot out a schedule for optimal repayment and this is something that you could also bring up to your lender if their options are flexible. If you’re retired and worried about your estate, it may also be worthwhile to dedicate a meeting (or several) to this issue. It never hurts to prepare for the future and have a plan set in place, so discussing these matters can help ease your mind and reduce stress. Another issue you may want to learn about is how your property and assets may be affected when taxed. Your financial advisor can discuss how that may work depending on the type of loan you are interested in. Overall, talking to a financial advisor will allow you to gain more knowledge about your personal situation and how to best navigate the journey ahead.