By: Kelly Wilson
Personal loans are saviors during the emergency hour when one feels a shortage of funds. The flexibility that they can be used to meet any personal financial need adds to its attractiveness. Many people seek personal loans for various purposes viz. financing a wedding, education, travel, home renovation, medical emergency, etc. One can also use the personal loan amount to consolidate debts at a higher rate of interest.
With technology taking over the banking sector, one can now
avail a personal loan online with a click of a button. The whole loan
application process has been simplified and documentation is minimal making it
easy to procure it. A personal loan is being offered by several top banks and
NBFCs at a competitive rate of interest. Though personal loans are easy to
avail, one must check the following pointers before applying for a personal loan in Delhi
to avoid getting the application rejected.
Eligibility criteria are the most important factor when it comes to a personal loan. Though the eligibility criteria for a personal loan is not stringent, the borrowers must comply with them as it is non-negotiable. Different lenders have different criteria for offering a personal loan. One can check for the same on the online portals of the lender by using their personal loan eligibility criteria. On account of your financial credentials, repayment capacity, and credit score, the lenders decide the loan amount and loan tenure for which you are eligible.
Lenders are mainly concerned about the repayment of the loan amount and therefore it is mandatory for the borrowers to be sure of their ability to repay back the borrowed loan amount in easy monthly installments. Though the lenders check this aspect on their end before approving the loan to be assured of the return of the loan amount, it is important that the applicants have a steady source of income from which he would repay the loan.
Being unsecured, personal loans incur a higher rate of interest in comparison to secured loan products. Thus it is important to check different lenders for their offerings in terms of the interest rate. A good credit score and repayment history can result in lenders offering you a low-interest rate deal. One can compare different lenders on account of their offerings on platforms like that of LoansJagat and choose the one which best meets their needs and requirements.
Pre-payment charges or foreclosure charges are charged by the lender in case you repay the loan amount before the end of the loan tenure. It is a good option for the borrowers as they do not have to pay the extra interest. But on the contrary, lenders lose on the prospective interest which they thought they will receive by the end of the loan tenure. For this purpose, they charge a foreclosure fee from the borrowers if they wind off the loan before the end of the tenure. Different lenders have different charges and hence it is imperative to know about it from the lender before you opt for the loan.
Personal loan providers usually take fifty percent of your net monthly income as the prospective EMI amount. However, this is subject to factors like other ongoing liabilities, credit card payments, etc. It is important to choose an EMI which is comfortable for the pocket and can be repaid on time each month. The online portals of the lenders offer tools like the personal loan EMI calculator which lets you calculate the EMI on account of your income and financial stats. Choosing a higher EMI amount for shorter tenure may sound enticing but a lower EMI for long tenure can be easy for your pocket and doesn’t require you to compromise on your lifestyle.
It must be noted that personal loans are like any other loan product. They must be availed only in extreme financial emergency or after minute planning. Failing to repay the monthly installments on time can significantly hamper one’s credentials and thus must be disciplined enough to repay the EMIs on time. It is a liability that needs to be repaid and hence before procuring one, it is important to figure out how you will repay the loan.
Author Bio: Kelly Wilson is an experienced and skilled Business Consultant and Financial advisor in the USA. She helps clients both personal and professional in long-term wealth building plans. During her spare time, she loves to write on Business, Finance, Marketing, Social Media. She loves to share her knowledge and Experts tips with her readers.
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