If you are considering taking a personal loan, then I must say that it really should be a well thought decision. As with this decision comes a lot of liability. If you’ve decided to take a loan then the next step is to find the right bank who can lend this loan to you. No-one will guide you to the right bank or loan provider which is best suited for your personal loan requirements.
There are plenty of options when it comes to banks, financial institutions and individual financers in the market but, you should do your research well as this will be a long term association.
Your selection can have impact on your loved ones and other relatives, and that is the reasons you can’t take this lightly. Question is how to select the best loan company when you have these many choices and which is perfect for you? Yes, we are going to help you solve this question today.
There are certain things which you should keep in mind when you’re evaluating loans from various financial institutions/NBFC. We’re just here to help you but the decision is actually yours.
There are some factors based on which you can compare personal loans from various lenders. Here they are:
Personal Loan amount offered to the consumer is different in every bank and financial institution. It is a good idea to ask a bank about their max and min personal loan disbursement amount for a loan. Eg, if you need a low amount loan, then you should look for the banks whose range start from a very low amount of money. There are financial institutions who offer as high as Twenty six lakhs in a loan. If you need a high personal unsecured loan amount then HDFC personal loan should be in your list.
The next thing that you should compare is the loan rates offered by several banks. Who would like to pay more when there are options available for lower rate of interest?
You can check the loan rates provided by lenders online but, it is advisable to go inquire about rate of interest yourself. The reason behind this is financial institutions provide various interest rates as per the credit score of individuals.
For example, you have got a good history of repaying your equal monthly installments, then there’s a strong possibility that you will get a lower rate of interest. The average rates range from 10% to 34% based on your credit score
Besides the rate there are additional charges which loan provider charges to process the loan application. The fees also commonly called processing charges.It is the lender which decides on the % of the processing fee to be charged from the borrower.
For example, when you’re applying for Rs 6 lakh as loan from a lender whose processing fees is 1.5Percent, then you will have to pay Rs 9,000 as service or processing charges. Processing fees vary from bank to bank but, generally it ranges from 2 to 2.5 % of your loan amount if your loan amount is big then processing fees will have an impact on your pocket and hence should be a selecting factor of your lender.
Becoming eligible for an unsecured loan is the basic requirement to get a personal loan.If you’re not eligible then no bank or financial institution will offer you a loan. You might get a loan from a private loan provider with a higher rate, which might put a hole in your pocket. Yes, you should check the eligibility criteria before choosing and applying for any personal loan. If you do not do this in the first place, then chances are you’ll end up killing considerable amount of time and your energy.
I’d personally say this should not be missed at all.
We all hate paperwork, but for a easy personal loan approval, it is very important to submit all the required documents at once. Papers required by lenders are generally similar but might have differences as per the loan company and your credit profile. Often, some of our documents do not have right personal information. So, checking into required documents section of financial institutions gives you an idea of what is needed.
Concern about high installments and EMI’s is definitely there at the time someone takes a loan. Is loan repayment amount is nightmare for you? To take care of this concern, lenders have flexible instalment options. If loan EMI’s is more than what you could pay off every month then, make sure you consider reducing your loan amount. Not every banks will have all sorts of repayment options so, it is usually a good idea to talk about this while you are applying for a personal loan.
Longer the loan length, lower the EMI amount. When your salary doesn’t allow to pay the loan EMI’s in a timely manner then it is best to either reduce the loan amount or increase the duration of the loan. Not to worry, your lender will definitely give you an option to choose your loan duration but, it may have some dependency on your credit rating.For example, you can opt for a flexible duration ranging between one to five years while taking hdfc bank personal loan.You can search more such offers on the internet.
Every customer who’s got the right intention will always pay his or her EMI’s by the due date. However, when there is any default, then could be because of some unforeseen reason. Loan companies also understand this problem. That is why there are certain penalty charges that are already fixed by loan companies in case of missed repayment. You should research and compare the loan offers on this basis irrespective of how much confident you are about your punctuality or pay back ability.
You can also read personal loan application tips before applying loan.
Lenders face lot of default in lending products and hence they decide the percentage or fixed fees on delay of the payment (it can be both too). Charges also acts as a reminder for borrowers to EMIs on time. As we pointed out earlier, penalty can vary from bank to bank and also dependent on your rate and time you have defaulted.
All these factors are easy to find on the loan companies site or the application form which you fill for the personal loan. It’s just that we are not 100 percent aware of these and their impact on us.
They think that the most important thing is to have the loan amount as early as possible. Simple homework of 2-3 hours is exactly what you need to find all the things about these elements. It is obviously possible if you have a look at several websites of banks and nbfc’s.