Caution is advised when money exchanges hands.

Taking out a loan can be a bit of an intimidating process. You’re accepting a large amount of money from a faceless business that you may not be able to pay back in an expedient manner. No matter how scary it may seem, though, it’s a simple business transaction like any other. Nobody’s trying to deliberately clamp a prison manacle around your shin; as long as you do your due duty in finding a loan for yourself, it should go pretty cleanly. Before you take out a personal loan, mind these things.

Shop Around

As with any large-scale transaction, you definitely want to do some shopping around before you commit. Explore lots of different lenders, check their rates and plans, and perhaps most importantly, do a little digging into their business ethics. A company may look like they have the perfect loan for you, but if you find a lot of bad reviews with genuine warnings against them, it’s probably best to just go elsewhere.

Mind the Hidden Costs

I know I said nobody was going to try to clamp you, but the unfortunate fact of the matter is that there are folks in this business that’ll try to squeeze a little extra cash out of you. It’s the nature of the beast, unfortunately. Before signing any kind of contract or agreement, make sure you read over any relevant documentation for potential charges. If you bring these up with whoever you’re working with for the loan, you might be able to get the charges removed, or at the very least, get an explanation for why they’re there.

Don’t Borrow More Than You Need

When someone offers you a big pile of money and says “take what you need,” it can be tempting to just take the whole thing. Remember, though, loans always have accumulating interest, and the more you borrow, the more you’ll have to pay back. You should only borrow the bare minimum of what you need AND what you can realistically pay back.

Make Your Payments

Pay your bills in full and on time. Missing your payments, in addition to piling penalties onto your loan, will earn you ill will with the loaner, which could in turn land you in hot water with a credit bureau. Missed payments do nothing but saddle you with more debt and take a bite out of your credit score. If life takes a sudden, dramatic turn, don’t try to weasel your way out of what you owe. Talk to your loan agent and see if you can work something out.