Clix > Finance > Five points to remember before applying for a personal loan

Five points to remember before applying for a personal loan

Clix October 25, 2018

Gone are the days when people would think twice about applying for personal loans. Now, they come with greater accessibility, competitive interest rates, and faster approvals, making them the go-to solution for most financial problems. So, whether it’s an exotic vacation, a dream wedding, or a medical emergency — all you need to do is apply!

Here’s a checklist you should keep in mind before you begin your application:

Evaluate the Need

With so many easy financing options, it’s easy to jump onto the bandwagon and borrow more than you actually need. And this can leave you with a burdensome debt that could’ve been avoided. That’s why, it’s important that you plan your repayment well in advance and apply for the loan accordingly — helping you keep financial headaches at bay!

Get the best deal

Look around for the best deals at various banks and NBFCs. And while doing so, compare interest rates, processing fees, penalty charges, etc. You could also go a step further by reaching out to agents to help you make an informed decision.

Go for a suitable loan tenure

Don’t be in a hurry while choosing your loan tenure and take your time to assess your current finances and available EMI options. A shorter loan tenure usually means that your absolute interest outflow will decrease while your EMI payments increase. On the other hand, a longer loan tenure comes with smaller EMI options and can potentially help you manage your finances better. Also, keep in mind that most lenders prefer the borrower’s EMI to be within 50% of their monthly income.

Check out smart repayment options

Repaying a loan comes with several smart and flexible options. One is the step-up repayment plan, which starts off with lower EMIs and steadily increases over time. On the other hand, a step-down plan does just the opposite with higher EMI amount that gradually decreases as the tenure comes to an end. That’s not all, if you do manage to have additional funds, you can always avail the pre-payment or part-payment options. Remember to watch out for an additional fee charged by the lending organization for full or partial payment before the loan tenure ends.

Don’t ignore the fine print

The last box to check off — closely read the terms and conditions of your loan. This will help you understand the clauses mentioned in the loan document. And in case you have doubts, it’s best to clarify them with your lender as soon as possible.

Thankfully, for you, personal loans have become very easy to get with streamlined processes. Just remember the points listed above, to enjoy the best options out there.

T&C Apply. Disbursal of the loan shall be at the sole discretion of Clix Capital Services Private Limited and it’s group companies subject to its policies and execution of such documents as maybe necessary

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