A personal loan is an unsecured loan, means we don’t need to submit the collateral for applying it. This is the main reason, why many of us go for applying for a personal loan. A personal loan is processed quickly, it requires basic documents and many other benefits associated with the personal loan. You should not rush to apply for personal loan, you must consider some facts about personal loan, look for the major mistakes people complain about after taking a personal loan, which they didn’t focused while taking a personal loan.
Here are some of the things to consider:
No clarity: As Personal loan doesn’t need any specific reason to apply. People, to fulfill their basic financial needs apply for the loan. But the loan which you take must need to be repaid. So you must keep this in mind. Don’t take loans for unnecessary things and pay interest rates for that.
No proper Research: Before taking a personal loan, you must check with the lender with different loan options available to you. Don’t consider a personal loan is the only option for you. Consider the tenure, interest rates, tax benefits and EMI options available with different lenders for different types of loans and go with the options that you are open to paying the loan.
Applying beyond your eligibility: check your eligibility criteria at different online websites and apply the loan based on your eligibility criteria and budget. The EMI amount should be in between 15-20% of your net income. Don’t try to overstretch your budget limit.
Going with Lower EMI’s: Don’t go with lower EMI’s, it increases the tenure and interest amount to pay. Consider the most likely EMI you can pay without getting any trouble in repaying that amount.
Trying to hide financial conditions: Your complete financial report gets recorded by the financial institutions. To calculate the credit score, even if you want to hide your running loan and other credit it will be of no use.
Applying without checking credit score: Credit score is the first thing which seen by the lender when we apply for a loan. So before applying for a loan, you must check with the credit report from any financial institutions such as CIBIL. Try to improve the credit score if it’s not good before applying for a loan.
Every time apply for a loan at a different vendor: Instead of going to the lender, where you have already taken a loan going to another lender is a mistake. Because the previous lender knows you how you repay the credit, so they offer you with less interest rates than considering a new lender. And also the bank where you have already account prefer those banks they provide you with some concession in an interest rate.
Multiple loan application: Doesn’t keep on applying for a loan in a span of period. Wait for the response of previous application and then apply for another. Every application of loan get recorded in your credit report and it will ruin your credit report if you have too many application in a span of time. The bank will consider you as a credit hungry and impose on you a high-interest rate.
Signing the agreements without reading it: The lender won’t tell you orally complete details when you apply for a loan they include those details in terms and conditions of hidden charges, late fee charges, Prepayment charges and other. Before signing the application you must understand every aspect, if you don’t understand the banking terminology, seek financial expert advice.
Applying for a loan without informing family members: Discuss with your family members before applying for a loan. Because they can suggest you the better option by considering the family budget. They can help you in a better way to avoid taking a personal loan.
If you still need any suggestion regarding the application of personal loan. Please do contact our financial expert team at 365eloans.com. We are happy to assist you at no cost.