Do you have any medical exigency in the family for which you need urgent cash? Or do you want to shred off high-cost loans or credit card to get out of the debt spiral? And in addition to all these things, today the lifestyle that most of the people wish to live today takes away the major chomp of your savings, right? What about the savings that we must assign for our retirement or emergency fund? So, how a personal loan can help us with this? Or explain, what are personal loans India? Well, unlike a home loan or a car loan, a personal loan comes under unsecured debt, for which a lender does not insist on collateral. And being unsecured in nature, the risk for any lender would be high as they are left with the only option- i.e. legal to resort in case of a default. Hence the personal loans India crafted especially according to the Indian market, and are slightly higher than the ones which are backed by collateral.
Well, a personal loan comes really handy when your need for cash is urgent, and at times when you want to lower your overall debt burden, or even when you want to boost your credit score/CIBIL score. And because of its quick approval process, it is considered to be as an easy way to access funds. But whenever it comes to availing personal loan India, you need to be slightly cautious or you can say aware. This is because you might end up choosing the wrong financial product, and your mistakes can bound lenders to extend a personal loan at high-interest rates. Here, we will tell you what all you should weigh before you decide to sign the loan agreement.
Evaluate Your Requirement: Many financial pundits advise that one should not overboard with the loan amount. Well, we all know that personal loans India is an easy way to access funds and are often disbursed within a few days. And, this can make a tendency to go for a larger amount of loan than the actual requirement. So, one should limit the loan amount to what your end objective or purpose is.
Overall Cost: Continuing with the point mentioned above that one must consider the overall cost of the personal loan incurs on your pocket, which includes the personal loan interest rates and the additional fee. If the requirement that you have today is not worth the overall cost, then maybe it is not the wise move to take a personal loan. Try at your level if you can satiate those needs by any other means or not, like through credit card.
Interest Rates: There are two types of personal loan interest rates in the market, and the major thing to go through before approaching to a lender is to check whether the interest rate is fixed or variable. The fixed interest rate implies that it remains constant throughout the loan tenure and a variable interest rate used to change, i.e. increases or decreases according to the ongoing market conditions-index value.
Additional Charges: The accumulated interest is not only the only fees that are charged in a loan, but there are also other multiple additional charges associated with it. Additional charges such as processing fee (when the loan is being processed), late fee, and prepayment fee. Lenders charge a late fee when you are inconsistent with your monthly EMI’s, and pre-payment is when you choose to pay or close the loan amount before the decided tenure.
Choose One: See all and choose one, like they say that you have to kiss a lot of frogs before you find your prince. But in the personal loan India, kissing all the frogs can generate a problem for you. Hence, you should look at multiple loan options, deals and offers before choosing the one, through online loan aggregator’s site and then apply to the ones you feel that your loan can get approved on and can commit to.
Well, these are some of the common factors or things that one needs to consider before you get a personal loan India. If you keep these things in mind, you will never go wrong while borrowing the money.
Hope this information helps you!