What To Consider Before Applying For A Personal Loan In India

There are many things that will cross one’s mind when they think to apply for a personal loan. A lot of things need to be taken into consideration before a person can finally come down to a conclusion. Below are a few things that one can pay attention to the next time they plan to apply for a personal loan.

Convenience in loan processing when you apply for personal loan online

Usually, there is a necessity to provide a lot of documents when a person is applying for a personal loan online. Ideally, the documents required are proofs of identity, address details, other proofs of income sources and tax return files. The modern lenders have removed the chunky document requirement only if the loan application is for a small amount. There are a lot of BFSI web portals that can help a person get instant personal loan online.

Also Read:- 5 TIPS TO NAIL PERSONAL LOAN APPROVAL

Choose the lender with care when you apply for personal loan

Financial institutions and banks are bombarding consumers with offers of personal loans. These finance corporations claim that their interest rates are competitive enough to be the lowest out in the market. Its any day more convenient to apply for a loan with a bank where you already have an existing A/c. Ensure that you rigorously compare and try to look for better loan terms and interest rates among the options available in the market. Shop around for the lowest rate using a loan aggregator website. Financial institutions and banks are bombarding consumers with offers of personal loans. These finance corporations claim that their interest rates are competitive enough to be the lowest out in the market. Its any day more convenient to apply for personal loan with a bank where you already have an existing A/c. Ensure that you rigorously compare and try to look for better loan terms and interest rates among the options available in the market. Shop around for the lowest rate using a loan aggregator website. Apply for personal loan online at CreditKaro.com.

Evaluate and assess the interest rate thoroughly

Nobody can beat banks in financial manipulation. The idea to pitch a flat rate of interest is a usual method to persuade consumers in the interest of the bank’s business strategies. It should always be noted that the flat rate creates a misconception in the consumer’s mind as it doesn’t consider the main balance reduction with each EMI paid against the loan. Ideally, if Emi’s are being paid against a loan the subsequent month’s interest should be calculated on the reduced balance.

Avoid opting for advance EMI’s

In this method of a loan application, the borrower technically pays more than the depicted interest. Let’s take a small example to understand the concept behind this trick, a bank asks its account holder to pay 2 months of advance EMI when the borrower takes a loan of a certain amount, technically when the borrower pays 2 months of advance EMI the actual loan amount reduces and simultaneously the interest should also drop but this doesn’t happen and the borrower ends up paying extra interest calculated on the total loan amount. A borrower fails to understand that the advance EMI paid shouldn’t be considered as an EMI installment rather should be considered as a down payment.

Too many lenders shouldn’t be approached

While in the process of window shopping for the best possible interest rate among different available lenders the credit score of the borrower gets accessed multiple times. This could prove to be a little harmful to your credit score as it can take a hit while it’s being inquired by multiple lenders. The lenders might also sense the borrower to be a credit hungry individual. It is recommended to go through different loan aggregate web portals to select the lowest interest rate. These days it’s very convenient to apply for personal loan online.

Time is taken for loan disbursal

Similarly, When there is an urgent need of monetary backup anybody will be in haste to get the loan approved as quickly as possible. In these situations, the time taken by the financier to disburse the loan amount into the account is a very essential factor that plays a role in deciding the right financier.

Repayment period

The total tenure of the loan repayment period can be taken as a burden by a borrower because an EMI takes up a significant share of your income. So that the most common solution to avoiding this mental burden is to choose a shorter loan repayment period. However, this brings up the EMI amount and that can prove to be a bigger concern for some individuals.

Also Read:- Personal Loan For Self-Employed With No Income Proof