We’ve all experienced a time in our lives when we didn’t either have enough money to purchase a house, go on a vacation, purchase a gadget of our choice, pay for wedding expenses, or pay for college costs. Many of us have ruled out taking out a loan because we believe it is a time-consuming, tough and lengthy procedure. However, the case is rather the opposite. Nowadays availing a personal loan is just a few clicks away. You can apply for a personal loan, complete your KYC and process repayment from the comfort of your home. And the great news on top of that is that almost all banks are willing to lend to applicants who satisfy the qualifying requirements, have a strong CIBIL score, and can repay the loan. So, read on to know about a few pointers to help you obtain a loan authorised quickly and painlessly.
Calculate Affordability: Bridge the Gap between EMI & Monthly Income
Before you apply for a personal loan, make sure that you can afford to pay the EMI on time. You should ask for a loan that your net monthly income can readily cover. While applying, check each bank’s maximum eligibility and apply for a loan amount that is doable and does not jeopardise your financial health. Also make sure that your total EMI on all loans does not exceed 50-60% of your monthly income.
If you’ve previously taken out several loans, attempt to combine them into a single loan.
Fix Your CIBIL Score
Every bank evaluates your credit score and payback history before approving a loan. It is a proven truth that banks will not provide unsecured personal loans to those with bad credit.
Pay your EMI on time to maintain a decent credit score. If your CIBIL score is less than 700 or you have recently defaulted on a loan, you should not apply for a new personal loan. Please check your credit rating with CIBIL before applying for a personal loan if you are unsure.
Choose the Right Lender
Different lenders have varied loan costs and qualifying conditions, as well as different interest rates and other fees. Compare them amongst several banks to see which one best suit your needs, and if you can save even a penny on an EMI, do so.
Usage of Personal Loan
Personal loans are typically used for things like home renovations, vacation, weddings, and other unexpected needs. Make sure that you’re applying within the span of as those listed above.
You should choose a loan term that fits your needs and has cheaper interest rates. Do not apply for a personal loan for purposes that are not acceptable, since this may result in your application being rejected and will have an impact on your credit score.
Check Processing Fee, Foreclosure Charges & Prepayment Options
You should always check the processing charge for each personal loan option you’re considering. You should evaluate if you’ll need to payback the debt in part or in whole. Check to see if the plan you’ve chosen allows for partial payments and foreclosure and if the applicable costs and limitations if prepayment is permitted.
To present yourself as a creditworthy borrower, focus on these 5 basic techniques. It should be backed up with adequate documents and a good credit score. Banks will be happy to give you money at cheap interest rates for your specific needs.