Some best tips to take out personal loan

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A personal loan is one of the best solutions for any emergency or short-term financial crisis. The loan is quite useful and can handle both planned and unplanned expenses. Digitization and the introduction of technology in personal loan processing has sped up the entire process and as a result, you can now apply for a personal loan online and get approved in less than an hour. Sounds too good to be true, right? But this is true. Fast approval, fast disbursement and many more factors like this make personal loans one of the most sought after financial products by most. Well, despite several benefits, there are certain things about the personal loan that have not been told. But don't be afraid, we are here to give you some advice on a personal loan that no one will tell you.


 

Take a personal loan only when necessary

This is a fact that the interest rate charged for a personal loan is comparatively higher than that of other loans. Therefore, keeping this in mind, you should always apply for a personal loan only when necessary. It's also important to understand that while a loan helps you pay off your short-term goals, it will pay off over the next several years without fail. Therefore, it is important to ensure that you will be able to make the monthly payments within your income.

Beware of additional charges

Before you decide to go with a particular bank for your personal loan, you should inquire about the additional charges in addition to the interest rate. Processing fees, GST, verification fees, EMI late payment penalty (defaults), prepayment penalty, or loan foreclosure are some of them.

So you need to make sure you take other factors into account as well, as these charges can add up to a larger amount.

Opt for a shorter loan tenure

There are loan providers / banks that offer personal loans for a longer repayment period with a lower EMI. This is quite tempting for many as they think they are going to save on EMIs. However, it is worth noting that in a longer tenure you end up paying more for the component.

Having a good CIBIL score can help you.

This is not known to everyone, but having a good CIBIL score can help you get the best deals on your personal loan application. Having a good CIBIL score gives you an advantage in negotiating with the lender for the best interest rate.

Research Thoroughly Before Applying

There are several personal loan providers on the market, each offering the same product at a different interest rate. To get the best deal on your personal loan, thorough research is essential before selecting your lender. So, before applying, make sure you've compared features like interest rates, loan tenure, processing fees, etc. and then choose a loan provider that meets your requirements.

Therefore, if you plan to apply for a personal loan, it is important to consider these factors, as they will not only help you get the best deals on your personal loan, but they will keep you safe from future problems.

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