You can take a new contract to replace your existing personal loan.
Many people are under the misconception you can "change" the terms of a loan or "change" loan companies. There is no simple way to make this switch. However, you do have the option of refinancing the loan. In this case, you will have to take a wholly new loan and replace the old terms with the new loan terms. Therefore, it is possible to change a loan company on a private loan if you are willing to trade your old debt for a new one.
Benefits
Most people who look to change a loan company want to capture financial rewards for doing so. For example, perhaps another lender offers lower rates. You may be using another lender for a home loan or car loan and want to place all of your debts with one company. In this type of scenario, refinancing your personal loan to a new lender can present a huge benefit to you.
Challenges
There are two main challenges to saving money through personal loan refinancing. First, your existing lender may hit you with penalties or fees for leaving the loan early. You may have to consolidate these fees into your new loan, which can raise your cost, rather than lower it. Second, you will have to apply for and secure the refinancing loan anew. You will be going through the loan application and verification process all over again, so you must have good credit and a stable income to qualify for the new loan.
Options
If you want to move your personal loan to a new lender, you have several options for refinancing the loan. First, you can take a new personal loan and simply use it to pay off the existing debt. You may also consider combining more than one loan. For example, you can take a new loan to pay off your personal loan, car loan and credit card debt. You may also be able to consolidate your personal loan into a mortgage, which can reduce the cost of the personal loan in the end. Consider options to settle down your personal debt at the time you change lenders if you are facing more debt than you can afford to pay off.
Process
Once you decide on a lending option, research lenders who provide this type of loan. Getting quotes from two or three lenders is advised. Once you have quotes from lenders, choose one or two you would like to apply for the loan with. It is wise to apply with more than one lender because you may be denied by one, or you may simply find one is offering you a better deal than the other. The lenders will consider your application and underwrite your new loan; this process means they will make sure your application is accurate. Then, you will be presented with a loan contract from the new lender. If you do not like the contract as it is, negotiate for better terms. If you have a contract you are happy with, sign the contract and move your loan to the new lender.
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