A lot of individuals often rely on personal loans as it is one of the best ways to bear any expenses whether for education, wedding, medical and so on. Though personal loans serve to be a better option, it is wise that you apply for the one that is right for you. A number of factors require your attention for the same. To make it easier, mentioned are personal loan tips every individual need to follow to avoid any problems later. Get help from the personal loan EMI calculator to know more.
Opt for Emergencies Alone
It is quite understood that personal loan is a feasible solution as it can be used for end number of things. Furthermore, it requires minimal paperwork and requires no securities. However, you are advised to apply for the same during emergencies alone. Consider personal loans to be your last option. One of the major reason for the same is because personal loans are expensive after credit card loans. You are highly recommended to apply for a personal loan when you want to get out of an expensive debt.
Know the Interest Rates
You should know every bank offers different interest rates. Considering this aspect, it is important you compare the interest rates and choose the one that meets your requirements.
A small tip: A big loan for a longer period of time tend to reduce the monthly repayment amount, but the interest rates tend to be larger than the one you buy for a shorter term.
To get an idea of what percentage of interest rate you will be paying, you can use the personal loan calculator. It will give you a rough idea thus helping you make a wise decision.
Do Not Send Too Many Applications
While you are searching for the best personal loans, you are highly advised not to send too many applications. Though you might find this easy as you think at least one of the bank or lender would accept it, it is not a feasible option. When you send too many applications for the personal loans, it tends to affect your credit score. Furthermore, it shows you are applying for personal loans with many banks with the hope to get more loan amount. This is one of the major reason why a lot of personal loan applications gets rejected.
Do Not Forget the Foreclosure Clause
Banks and other financial institutions tend to offer personal loans but, do not admit on the partial repayment of the loan. Banks want their customers to continue paying the Equated Monthly Installment (EMI) as the high-interest rate is charged. Keeping the same in mind, it is wise you review the prepayment charges with each bank. This is application especially if you prefer to pay off your loan amount in lump sums. Use EMI calculator for a personal loan to get an idea of how much of loan amount you will be paying on a monthly basis. This will help you be prepared and keep the desired amount ready.