Loans can be helpful tools, but many people lose money because they don’t understand the fine print. Here are the top mistakes to avoid:

1. Focusing only on the monthly payment: A low monthly payment may mean paying double in total interest.

2. Ignoring the APR: Annual Percentage Rate includes fees. Always compare loans by APR, not just rate.

3. Taking more than you need: Borrowing €20,000 when you only needed €15,000 costs thousands extra.

4. No early repayment plan: Even €25 extra per month can cut years off a loan.

5. Not reading penalty clauses: Some banks charge fees for paying early—always check.

6. Co-signing blindly: If the borrower defaults, you’re fully responsible.

7. Ignoring variable rates: They can double over time. Always test “what if the rate rises 2%?”

Knowledge is power. Before signing, run the numbers with a loan calculator and simulate different scenarios. A 30-minute review can save you years of regret.