Things To Check Before Applying For a Personal Loan - Loan Trivia

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Friday, 25 October 2019

Things To Check Before Applying For a Personal Loan

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Today, personal loans have made life stress-free. Dealing with financial challenges, such as a marriage in the family, a child’s education, and home renovation, has become easy with personal loans. Also, it being an unsecured loan, you don’t have to mortgage your assets. First-time borrowers often worry about personal loan eligibility. But thanks to lenders, it is now easy to get such a loan. 

Indeed, certain questions come to mind when you consider applying for a personal loan. Some of these questions are: how to choose the right lender, what documents do I need to submit, and how to get the best interest rate? 

Answers to these questions will help you find the right loan. Also, it would reduce the chances of loan rejection if you plan everything carefully. And once you know which things to check, you can find the best rate. 

Here is a simple checklist to follow if you are planning to avail a personal loan: 

Check your credit score in advance 

Your credit score informs the lender about your financial health and credit history. In fact, no loan is approved without a credit history check. All banks and non-banking financial companies (NBFCs) closely examine this report to determine your creditworthiness. If you have a credit score of more than 750, you can even enjoy a lower interest rate. You can easily check your credit score by visiting the CIBIL website. 

Find out eligibility criteria 

The eligibility criteria for a personal loan differ across lenders. So, it is advisable that you check these with your preferred lender. Lenders consider several factors to assess your eligibility. For example, the documents that Lender A wants may be different from what Lender B wants. Therefore, keep all the relevant paperwork ready when you visit the lender. They will also judge your eligibility on parameters like age, income, and liability. For instance, you could consider approaching NBFCs like Bajaj Finserv for personal loan. Apply online for easy loan processing. 

An eligibility calculator will come in handy 

Your location also affects your personal loan eligibility. Lenders have a minimum net salary requirement for different locations. For example, the minimum net salary requirement for a personal loan in Kolkata may be lower than that required in Delhi or vice versa, even if the lender is the same. To avoid confusion, you can simply calculate your eligibility using a personal loan eligibility calculator. You can find it on lender’s website. 

Consider your existing debts, if any 

A debt is a liability, which is why you should consider it beforehand. Calculate your regular expenses, as well as credit card bills and other regular loan payments, before applying for a new loan. This is because lenders check your existing debt status in your credit history to evaluate your financial profile. Your liabilities determine whether you will be capable of repaying the loan. A smart move would be to clear existing debts, if any, before taking out a new loan. 

Importance of repayment planning in advance 

Planning your loan repayment has many advantages. It helps you choose the loan amount and the tenor efficiently. This, in turn, reduces the chances of missing an equated monthly installment (EMI). A missed EMI not only attracts penalties but also affects your creditworthiness. Try to choose a loan amount that you can easily repay. To simplify the process, you can also use an EMI calculator available on the lender’s website. 

Summing up 

Do your homework well and opt for a loan that suits your budget and needs. NBFCs such as Bajaj Finserv offer personal loans up to Rs.25 lakh. They even have a simple checklist for personal loan eligibility. Bajaj Finserv also provides pre-approved offers on personal loans and other financial products. This simplifies the process of availing a loan and helps you save on time. Just share a few basic details to check out your pre-approved offer.

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