The reason why people in need of urgent money take personal loans are many. Among them quick disbursal of funds, help in improving finances, zero restriction on end use, minimum documentation and no collateral requirement are present.
Credit score is a must for money lenders. Those who lend you money often check for a strong credit score. And if you are on the good side of credit score then your loan has high approval chances. It is necessary that you check your credit report regularly.
Choosing the right lender is also important. Many of the banks and numerous NBFCs offer personal loans at the interest rates between 10.9% -26% p.a. Compare all the options as well as the interest rates, prepayment charges and terms and conditions.
The tenure of your loan is vital. Choose a tenure that suits your repayment capacity. Do not go over the top, you may end up in loan and struggle later. You must make sure that your EMI is in range of your FOIR.
A simple rule that must be followed if you are seeking loan is avoid submitting loan application to multiple lenders. If you do so, then the lender fetches your credit report, and this act pulls down a few points in your credit score. Applying to multiple lenders means all will seek for credibility and you may come across as credit hungry. So, watch that.
If you do frequent job hopping then the lenders see it as a sign of being unstable. If a person can’t keep a job for a long period of time that means his career is insecure. Lenders refrain from lending money to people who frequently switch jobs.
If you plan on taking a personal loan, keep these few things in mind and you are good to go.
