How to choose The Best Personal Loan
The decision to take a loan is a huge part of anyone’s life. The very first thing which comes in mind after deciding to go for a loan is the selection of a trusted and suitable lender.
There are no rational professionals who will guide you and would suggest the best bank for your loan as per your needs. The sector is flooded with banks and non-banking financial institutions but, you should research them before applying in any of them.
Whenever you go with a bank, you need to know that it is not only you but, also your family could have an impact based on your selection. Question is how to select the right lender when you have these several choices and which is perfect for you? Yes, we’ll help you answer this question today.
It is important to take care of somethings while comparing loans. Just wanted to tell you that our recommendations are just to give you guidance and nothing else. The decision, of course, is in your hands.
The comparison has to be rational and so it is essential that we compare based on top parameters:
Lending Amount
Various bank representatives have decided a range that they can provide to the borrower as the personal loan. It is important that you check with the bank or the lender about the amount of personal loan they can disburse as a personal loan. For instance, if you need a small amount of personal loan, then you must find a lender that provides lower amounts. There are banks who offer as high as 25 lakhs in an unsecured loan.
You can opt for Indiabulls Personal Loan in this scenario.
Loan Rates
The next thing that you should compare is the loan rates offered by several loan providers. We all need the lowest interest rate so that our equal monthly installments are low
Nowadays, you can check the rate of interest provided by lenders and financial institutions online however it’s a good practice to ask with their adviser. However, the actual interest rate offered to you may differ depending on various factors.
Let’s say, if you have a reputation of paying your credit card bills in a timely manner then you could possibly get a lower rate. The average rate of interest range from 11% to 40% based on your credit score
Processing Amount:
To process the application form there is a small percentage fee which bank charges from the client. The fees also known as processing charges. The bank decides the percentage of the loan amount as a processing fee.
For example, when an approved amount of the loan is 2 lakh and the processing fees of the financial institution are 3%, then processing fees for you would be Rs 6,000. Processing fees percentage is mostly between 1.5% to 2.5Percent of the disbursed amount.
If your loan amount is large then processing fees will have an impact on your pocket and hence should be a selecting factor of your lender.
Eligibility Terms and conditions:
Becoming eligible for a loan is a basic requirement to get a personal loan. There is no point even looking at getting a loan if you’re not eligible for it. If you have not checked the eligibility on the bank’s website for a personal unsecured loan, then please check it now.
It will likely be wastage of your research and time when you apply without checking eligibility as it can become the cause of personal loan being rejected.
So, research in this section thoroughly.
Payback option
The fear of high installments and equal monthly installments is always there whenever someone takes an unsecured loan. Is personal loan EMI’s amount is a problem? You can find multiple payment options with the banks to take care of this particular problem.
One should check the loan EMI’s and his compare it with the paying capacity. This will relieve a lot of stress.
Necessary Documents
Paperwork for a loan can be really frustrating generally but submitting your basic documents is essential for loan approval.
The list of papers also can vary as per the lender. Often we come across a situation when we do not have the correct documents at the right time. So, peaking into documents section of lenders gives you an idea of what is needed.
Penalty Charges
If you have taken a personal loan then you have the intention to pay back in a timely manner. However, sometimes the situation in life are not always favorable and hence you default in repayments. Banks and NBFC’s understand these issues. But because they want the default to be minimum, they have certain penalty/default charges for overdue payments.
You must check about the penalty charges even if you’re are 100% sure on paying the equated monthly installments on time. The fee decided primarily because nbfc’s also suffering from a loss due to your delayed payment. In that case, it’s actually a way of ensuring safety from any loss by the nbfc.
These types of charges may vary according to nbfc’s, rates of interest, the period of delay and so on. Nbfc’s are always very clear with regards to all of these points on their website or the documents which you sign. Surprisingly, most people are uninformed about these things and at times just don’t actually care (I would certainly call that as negligence).
Tenure
The number of equated monthly installments to be paid are is dependent on the duration of repayment in any loan. In longer repayment tenure, your equated monthly installment will be a lot less which can be a stress on you. Don’t worry, your bank will definitely offer you an option to decide your loan tenure but, it may have some dependency on the credit history.
For example, you can opt for a flexible duration which ranges between one to 5 years while taking Indiabulls Personal Loan. You can browse more such offers on the internet.
They believe that the most important thing is to take the loan as early as possible. Small research of 2-3 hours is exactly what you need to find all kinds of things about these things that are obviously possible if you browse a number of websites of banks and financial institutions.
