Know 5 Easy Ways To Get The Best Personal Loans In India - Loan Trivia


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Tuesday 26 July 2022

Know 5 Easy Ways To Get The Best Personal Loans In India

A personal loan is an unsecured credit line. This loan is provided by financial institutions. The best personal loans have several criteria, such as your employment history, ability to repay the loan, income level, occupation, and credit history. This is known as a consumer loan. It is also called a multi-purpose loan.

Today, many people are applying for personal loans to cover their huge expenses. There are many reasons for the significant increase in the popularity of personal loans. One of the reasons is that these loans are unsecured in nature. That means no requirement of collateral, and this leads to fast processing. Both banks and non-banking financial institutions provide the best personal loans. You can get a loan from any institution of your choice. With the presence of online services offered by financial institutions, you can get paid within 48 hours. 

Why do people need personal loans?

The common reasons why people take up a personal loan are:

  1. For funding travel.
  2. For purchasing an expensive home appliance.
  3. In a medical emergency.
  4. For debt consolidation.
  5. For huge wedding expenses.
  6. For paying off credit card bills. 

Here are 5 easy ways to get the best personal loans in India:

  • Compare loan interest rates- Perhaps a financial institution approaches you for your personal loan with 14% interest per year. Or, you went to a financial institution and saw that they are offering 16% interest per annum. No matter how attractive the bank offer may seem to you, make sure you compare other offers of other financial institutions also. Research is the best way to decide which lender to take a loan from. Thanks to the internet. Now, you can do it from the comfort of your home. You can research well by going to the websites of different lenders.
  • Compare fees and charges- Interest rates are not the only thing to compare before choosing a personal loan. You also need to see the various fees charged by different lenders. Typically personal loan-related fees are processing fees, service tax, bounce charges, loan cancellation charges, and late payment charges. The processing fee is the most important of all these charges. The processing fee usually lies between 1% and 3%.
  • Look for repayment flexibility- Most personal loans have full and partial pre-payment charges. This means you need to pay a small fee if you want to pay off your loan before the tenure ends. This is called a foreclosure fee. Usually, lenders charge foreclosure fees of 2%-5% of the outstanding balance. 
  • Find an EMI you can afford- You need to know the amount of EMIs. Ensure that you can make regular repayments on time and without any defaults. Knowing your EMI is easy with the help of an EMI calculator.
  • Examine other factors- Two factors affect the cost of a loan, and most people don't even know about them. These factors are repo rate and reverse repo rate. Now, you may wonder what is repo rate? The repo rate is the percentage at which the RBI lends money to commercial banks. The RBI declares a yearly repo rate. When this rate increases, interest rates on loans increases too.

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