When you want something, you first feel the need of that and then decide whether to own it or not. No decision should be taken without thinking and no product should be purchased without researching. Earlier people used to visit different stores, ask different people before taking a decision. But, now the entire process of research has become much simpler with the advent of online media. But, the importance of research has never decreased. This research process is required so that, you do not commit any mistake, or your decision goes wrong.
If you are planning to apply for a personal loan, you have to first aware of certain factors to avoid any further mistakes. There are certain things to know before availing a personal loan.Those are:
Need- You first need to analyse why you need the loan. Are you going to finance your dreams? Be it wedding, travel, home improvement, education, medical emergency or any other emergency, you can take the support of a personal loan.
Rate of interest- Different lenders offer different rate of interest. So, you need to compare among them to find which bank or NBFC offer the lowest among all. Even 1% less interest rate can bring huge difference on your EMI amount.
Eligibility and documents- The eligibility criteria set by the lenders also differ from one bank to another. However, the basic criteria are you need to a salaried employee aging between 25 to 58 years, you need to submit some documents like KYC, identity proof, address proof, photograph, etc.
Credit score- You must have a good credit score of above 750 to get loan sanction.
EMI calculation- You must take the support of an EMI calculator to calculate the exact EMI amount that you need to pay every month. This will help you to determine your affordability.
Costs involved- The cost you need to bear while taking a loan.
You need to verify these points before you take a personal loan. Otherwise the blunders that are going to arise in future will be tremendous to handle.
Aman Khanna is an experienced financial advisor who is well known for his ability to foretell the market trends as well as for his financial astuteness. He has an MBA in finance from Toronto University as well as years of experience delivering seminars on sound financial practices and debt management.