Thinking about applying for a loan? Get your credit score sorted first to ensure you get the best possible interest rate

Thinking of applying for a personal loan? There’s one important thing you need to do before you go any further — check your credit.

“No matter what stage of the process you’re at — whether you’re working out how much you can afford to borrow, comparing loans and lenders, gathering your documents, or you are literally just about to apply — you need to pause what you’re doing and take time to check your credit report,” Roland Bleyer said.

“Your credit report holds a wealth of information about you, detailing how you have dealt with credit in the past — and how you are handling it currently. This makes it essential reading for potential lenders, and as a result, essential reading for you. All too often, people apply for credit without checking their credit report first. This isn’t a great idea for a number of reasons.

“The point is, if you don’t check your credit, you won’t know what it says about you. But your lender will. When you apply, your lender will use the information within your credit report to determine the outcome of your application. If you have sketchy credit, your application could be rejected — or you may have to pay a much higher interest rate on your loan.”