Taking a Personal Loan (PL)? Not sure what to look for? Make use of the features listed in this handy guide to select the right loan product for you.
What makes life both exciting and challenging is its unpredictability! While you can’t protect yourself from the oddballs that life throws your way, you can indeed handle it effortlessly, when you’re financially protected.
This is where Personal Loans come in. Easy-to-avail, hassle-free and quick – a PL is the best way to meet your immediate financial requirements. Whether you’re looking to pay your child’s tuition, renovating your home, financing a wedding, funding a medical emergency, paying off a long-standing debt or taking a long due vacation, a PL handles all your monetary requirements.
With so many Personal Loan products available in the market, how do you select the best one? Here’s a comprehensive list of features that you have to look for when choosing your loan product.
- Eligibility Criteria
What’s the point of applying for a PL at a particular lender, if you don’t meet the eligibility criteria? The first parameter to check for is whether you qualify for the loan or not.
Different financial institutions have different criteria. For instance, some lenders offer loans only for salaried employees, whereas others are ready to extend the credit even to business professionals. Some require you to have a minimum net income to quality whereas others don’t have such restrictions.
So, make sure to check the eligibility criteria before you approach a particular financial institution. You can find the requirements by checking online on the organization’s website or by contacting the nearest branch.
- Cost of Borrowing
Make use of online comparison tools to compare the different loan products offered by various lenders. Apart from the interest rates, a PL has other charges like prepayment charges, processing fees, late EMI penalties and so on.
Make sure to check out all these hidden charges before you choose a particular loan product. Always opt for providers who don’t charge you early closure penalties and other hidden costs.
- EMI and the Loan Tenure
These are two main factors that determine the loan burden, and they are interrelated. Longer the tenure, lower is the Emi, but higher is the total amount you’ll end up paying. Similarly, lower the tenure higher is your monthly burden.
Make sure to pick a loan product that offers you a comfortable EMI that doesn’t strain your monthly budget.
- Loan Processing and Loan Disbursal Time
The loan processing time is the total time taken from the moment you approach a bank to the loan getting sanctioned. While it may take a few working days, several financial institutions approve your loan within minutes.
All that you have to do is submit your loan application with the necessary documents, and your loan gets approved within minutes.
Similarly, the loan disbursal time is the time taken for the loan amount to reach your bank account. This too varies from one provider to another. While major banks require a couple of working days or even a few weeks, several other financial institutions disburse the loan amount within 24-hours of your loan getting sanctioned.
- Ease of Application
Gone are the days when you had to visit a physical branch, wait in queues and submit your loan application. Now, you can apply for a PL from the comforts of your home. All you have to do is upload the necessary documents, fill in the online application and verify your details. Your loan is sanctioned within minutes.
Look for loan providers who offer you a simplified application process. This avoids unnecessary hassles and stress.
A Personal Loan is indeed a boon when you’re running short of cash to meet emergency requirements. With so many loan products available in the market, make use of the features listed above to pick the best one that meets all your needs.