Compare your Personal Loan
Once you have made up your mind to go for a personal loan, the next question comes which one would be the best personal loan for me.
How should I compare various personal loans available in the market? Here are the key factors one must consider while applying for a personal loan.
Key Factors to consider while applying for personal loan from a lender –
Here are the major factors on which one must compare a lender for your personal loan needs.
- The minimum and maximum loan amount that you can borrow from them
- What are APR rates applicable with that lender in your state
- What are other charges like application fee, prepayment fee and penalty for not able to pay an installment.
- What is loan re-payment tenure that is applicable to your amount with that lender.
- What is the minimum credit score they are looking for?
Prepare yourself for applying for the personal loan.
When you go to a lender, he may ask you to fill up an application form to consider your loan needs. Here in this application, he will ask you various questions which may decide upon whether he will entertain your loan application.
You must understand the questions in this kind of application form and answer them wisely as they may even impact the interest rates that may apply to your loan.
They may ask you things like why you are looking for this loan, loan amount and term you are looking forward to, and whether you are looking for a secured loan or an unsecured loan.
Also, check into your credit score before going for a personal loan application. It can easily be derived from an online credit score checker where you may enter your various amounts.
A credit score ranging from 650 to 750 is considered good for applying for an unsecured loan.
Don’t compare apples to oranges
Yes, a personal loan is more expensive than other forms of secure loans. This is because, in an “unsecured” loan, the lender is taking much more risk.
He cannot capture any of your belongings in you don’t pay it back on time rather than just applying penalties.
Under a personal loan, you do not require to pledge any kind of assets against the loan amount. It can be applied to a wide variety of reasons.
You are not bound one set of the requirement under personal loans. You can apply it for any kind of major expenses you need to make up front, and it could be just anything except for illegal matters.
Your personal loan is usually sanctioned within a short period of time within 36 hrs to 48 hours of an application as compared to other forms of loans.
What is required to apply for a personal loan?
To apply for a personal loan you must be at least 18 years of age, then you should have a good credit score, you must have a recurring source of income or a good bank balance to prove your ability to pay back the loan amount, and various proofs about your identity.