7 Things to Keep in Mind if You are Thinking About a Personal Loan

Updated on: 14 Dec 2021 // 12 min read // Personal Loans
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1. Do Your Research

To grab the best deal, it is vital to do your homework. You should be fully aware of the factors associated with your potential personal loan including – loan amount, tenure, various interest rates, processing fees, and prepayment/ foreclosure charges levied by the lenders.

Keep yourself updated about the modifications made by the Reserve Bank of India (RBI) regarding interest rates and other charges.

After a thorough research and comparison between loan offers of different banks, choose what is best for you. Let mymoneymantra help compare and choose the Most Suitable Personal Loan for You.

2. Read Loan Documents Carefully

Before signing the loan document, read the fine print carefully. Make sure you understand every clause mentioned in your loan agreement.

In case you have any doubt or if there is any discrepancy in your loan details, clarify your issues with the lender immediately

Consult our professional financial experts to clear your doubts regarding personal loans.

3. Be Careful with Money When Repaying a Personal Loan

Personal loans typically come with repayment tenure of 1-5 years. Stay away from spending lavishly until you repay your loan in full. Saving can be helpful in catering to your urgent financial needs during the loan repayment period.

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4. Pay Loan EMIs (Equated Monthly Instalment) on Time

Make sure you pay each EMI on time without missing the deadline. Late payment charges are applied if you delay your EMI. Defaulting or delaying repayment of even one instalment can be detrimental to your credit score as lenders may report you to credit agencies.

Hence, prioritize your financial goals and put aside part of your monthly income for EMI payments.

5. Analyze your credit score before approaching a bank

Knowing your credit score can help you understand your eligibility for a loan amount.

A Credit score plays an important role in determining whether your loan application will be approved or denied. Also, if you have a good credit score you can negotiate a low-interest rate.

Typically, banks consider extending a loan to applicants who have a credit score of 650 and above.

You can approach credit bureaus (like CIBIL) to know your credit score.

6. Be clear about the purpose of the loans / use of proceeds

While personal loans may not require collateral, the lender evaluates the use of proceeds.

7. Don’t make several personal loan inquiries simultaneously

Approaching multiple lenders for a loan and making too many credit inquiries can have a negative impact on your credit score.

For further information about Personal Loans or to apply online, visit www.mymoneymantra.com a one-stop leading trusted online financial services marketplace that hosts all leading banks and their products.

You may also speak to our financial experts toll-free at 18001034004.

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