You have finally decided to take the plunge and take a personal loan. Maybe it’s for a car, or a home, or any other expense you need the extra funds for. Now that you’ve made the decision, make sure you continue to consider other factors as well – such as how to choose the right vendor. To pick the right lender for borrowing, there are multiple factors you should keep in mind.
Don’t be fooled by the attractive language posited by many banks. “Just 15%” might be too much for one to pay off when the time comes. Make sure you check and verify each bank’s personal loan interest rates. Doing this will ensure that you get the best rates in the market. Your borrowing journey will become even smoother if you have good credit scores (700+).
Most banks charge a pre-payment fee. This means that if you pay a loan before you were supposed to, they will charge you extra for it. To avoid hefty payments on your loan, check each lender’s pre-payment rates. Some charge no pre-payment fees, and you should check personal loan eligibility for them first. Even though the charges are relatively nominal, it’s a good idea to save money wherever you can.
Before you take on a loan, you should ask yourself – is this an EMI I can afford? This is where a personal loan EMI calculator comes in great use. Before you choose a vendor, make sure you know what you can afford to pay. This helps you negotiate a better deal for yourself. Also, you avoid signing up something that might make you over-pay in EMIs. Reputed lenders make it easy for you by giving free EMI calculators to help you understand repayment schedules.
Processing fees, pre-payment fees, service tax, loan cancellation charges – are just some of the charges you pay above and beyond your EMIs. Some banks charge more, and some less. A good vendor will have minimal charges for each of the above, if at all. Before you decide to borrow, it is a good idea to be clear about these costs and expenses.
Some banks offer other benefits with their loan products. With refinancing options, loan transfers, and more – a personal loan can be very beneficial if taken with the right loan vendor. Most lenders have their benefits, as well as eligibility parameters, on their websites and other online portals.
In short – research and judgement are two of the best ways you can choose the best personal loan vendor. Consider the above tips, as well as others – such as alternative options, cause-specific loans, and more. If the loan amount is not too much, consider asking family members for the same. Though you should keep in mind that family and loans do not go well together.
No matter what you choose – with proper research and well-informed decisions, taking a loan with the right vendor will be a simple process for you.
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