By Nidhi Sharma
If you have unplanned expenses or an emergency that requires funding, personal loans can be an effective solution. Whether you have an emergency medical bill to pay for or want to renovate your home, personal loans are a good solution. They are available to anyone and can even be accessed online.
Still, there are lots of people who hesitate to apply for a personal loan due to its high-interest rate and complex terms. But this is a myth, personal loans are not expensive provided you fulfill the eligibility criteria and have a good credit score. The conditions and terms of the loan are very flexible.
• Your age • type of employment • your employer • your yearly income • your CIBIL score • your debt-to-income rate • your arrears
There are different eligibility criteria for different banks and if you meet those, you’ll get approved for the loan at a lower and further affordable rate.
Paying your EMI on time shows that you have repaid all your loans amount on time without hassle-free; also, it assures lenders that you will continue doing the same in the future and you are one trustworthy person. Your creditworthiness to repay the loan is the priority for banks and financial lenders to instantly grant the personal loan amount to your bank account.
Helpful tips to get a particular loan at lower rates –
It’s important to expose all your income sources to the lender as the particular loan is a relaxed collateral-free loan. The lender has to assess the repayment capability of the client by taking into account rudiments like income, job history, etc. These help in knowing the fiscal situation of the client.
The addition of all income sources in addition to the regular payment or business income helps in giving further confidence to the lender about the repayment capability of the client. Fresh income sources like income from a side business, rental income, etc help in making a more robust profile for the client.
It’s important to have a good credit score to get a particular loan at a lower rate. A credit score reflects your credit profile by way of a three-number numeric number that can range from 300 to 900. A score over 750 is good enough to get you a particular loan at a competitive rate from a reputed lender.
Several furniture rental firms also perform credit checks before providing you with their furniture on rent. Maintaining a good credit score would ensure that you get a good offer from the furniture store
You need to maintain a good credit score as it helps in getting a particular loan at competitive rates from a lender. The advanced the score, the better are your chances of getting a loan at a low-interest rate from a lender.
It’s always better to rope in a co-applicant or a co-borrower on your loan operation. By adding a co-borrower, you aren’t only suitable to add to the overall eligibility, but you can also get a good deal at a better interest rate.
A co-applicant to your loan operation can be a family member or a friend. By a co-applicant that also has a strong credit record, a lender’s confidence is increased and you can get the loan approved at better terms and interest rates.
The primary idea of adding a co-applicant to a particular loan is to increase the probability of prepayment of the loan. The co-applicant provides a further guarantee of prepayment in case the borrower defaults on the loan because of any reason.
A personal loan is offered by several banks and NBFCs and you can select the ideal lender according to the interest rates offered. It’s inversely important to consider factors like service, delivery, other charges, etc to finalize a lender. All these measures help in making the experience of taking a particular loan for an unplanned expenditure more affordable.
A particular loan is anticipated to be paid off in EMIs with interest to the lender. It’s important to try and make part- payments as and when you have fat finances. By making regular part payments, you would be suitable to get your star down over a period and reduce your overall interest outgo on the particular loan.
It’s veritably important to maintain a strong track record and pay all EMIs on time. Any gaps in payment of EMIs may not only attract charges from the lender which will increase your charges further but also impact your credit score. Thus, it’s important to keep a strong payment record with the lender and continue to pay the outstanding EMIs on time.