A personal loan is a collateral free loan that is offered for personal use. Be it medical, travel, education, wedding, etc., it is a multipurpose loan. Based on an individual’s CIBIL score and repayment capacity, a loanable amount is calculated by the lenders.
Most of the lenders facilitate applications for a personal loan online. Some of them have the instant personal loan feature with the amount credited in minutes. With a variety of utilization scope and quick approval, a personal loan is an efficient tool for an individual as per requirements.
Here are some tips to avail a personal loan hassle free.
How to get a Personal Loan?
- Interest Rates
Choosing a reducing balance method for interest calculation is more effective for than a flat method. A comparative analysis of interest rates offered by different lenders should be done before accepting any loan proposal. The lower the interest rate, the better the loan proposition.
- Choose the lender wisely
Do not fall for the first offer you see/get via email or an SMS. Make sure to do a thorough research of various lenders. Keep in mind the basic aspects such as interest rates offered, repayment tenure, processing fee, eligibility criteria to gauge the ones that will provide a better deal that suits your needs.
- Check for any hidden charges
While applying for a personal loan, you may miss out on considering processing fees and any hidden other charges that the lender may charge. To avoid any hiccups later, make sure that you are aware of all such charges and take these into account while planning your budget.
When it comes to processing fees, choosing a lower processing fee should be beneficial for you but it should always be compared in contrast with the interest rates. Sometimes lenders offer processing fee waivers. The same should be factored in while comparing.
Though tenure depends on your repayment capacity, choosing a higher tenure reduces the interest rates and EMI. Choosing a loan with less foreclosure charges is better if you wish to repay the loan before the stipulated time.
- Eligibility Criteria
Different lenders have different eligibility criteria, so you should look at a variety of personal loan offerings to select the ones that suit you the best.
Depending on the annual income of an individual, the lenders decide a loan amount. Some of the basic personal loan eligibility are:
- Individuals should be Indian residents
- Defined monthly incomes (differs from lender to lender)
- Aged between 21 and 58
- A minimum of 1 year work experience
- Minimum educational qualification of being a graduate
- An active resident of a city for a year at least
With the use of the points stated above, you can avail a good personal loan deal in India. A thorough comparative analysis based on different points should be done, which will enable you to arrive at a financially effective plan.