Whether you need financing for big-ticket expenditure of the household, need to infuse additional capital to the business, or seek funding for individual expenditure, a personal loan can be your go-to financing avenue. These loans are available in high funding quantum and come with zero restrictions to end-use, which makes them suitable for financing all expense types without any hindrance. You can also easily qualify for these advances that come with minimum eligibility requirements that are convenient to meet for borrowers across demographics and income segments. Given that paperwork requirement has been reduced to minimal too, completing documentation is not much of a hassle.
You can further prep up well when planning to apply for a personal loan to improve your chances of a smooth application process with fast-tracked approval and disbursal. Below give are some steps you can take when obtaining the advance for easy financing.
Steps to Consider When Availing a Personal Loan
1. Zero Down The Reason To Avail Your Loan
Before finalising on your loan decision, it is crucial that you identify the exact purpose for which you are availing the loan. Whether you need financing for home renovation or personal purchases, it comes under prudence financing to determine the precise reason for which you are borrowing the advance. Also, depending on your reason for availing the loan, you can decide if you need it right now or you can wait for some time for the lenders to offer you a good deal.
If your reason for availing the loan is not urgent and it can wait for a few more months, then work towards improving your credit score. Save the EMI amount in your account every month to make sure that you can live comfortably even after that amount gets deducted. Also, you will be able to pay for the down payment and avail a lesser amount as loan. However, if you are availing for a medical emergency or an urgent purchase, just make sure to spend some time to find the right offer!
2. Determine How Much you Need to Borrow
According to their individual borrowing profile, every person comes with a financing capacity that depends on their income and previously created credit history. If you have been a prudent borrower and repaid your advances on time, you are likely to be eligible for a financing of high value as a cash loan.
If availing the financing through the likes of reputed online loan apps, raising funding of up to Rs.1.5 Lakh is not much of a hassle today. However, it can be a wise decision to borrow only as much as you need and not how much you can avail. Once you have finalised your borrowing requirement, also zero in on the loan amount you would need to fulfil their financing purpose.
3. Check Your Eligibility for the Loan
Next, you must determine if you meet all the eligibility requirements laid down by financial institutions to avail the funding. It can be a generic check of the criteria applicable to the Indian financial market for personal advances and later on you can check with your selected lender for confirmation. Ideally, you need to fulfil a handful of requirements only to avail a personal loan with a reputed financial institution. It’s mostly factors like age, minimum monthly income, income stability, total working experience, and credit score.
4. Assess Affordability
You must also be well aware of whether the loan amount selected for borrowing turns out affordable for you or not both in the short and long run. To start with, check whether the selected loan amount and tenure render an EMI that is within your payment capacity or not without burdening your finances. You can use a personal loan EMI calculator to determine how much loan amount and tenure selected keeps the EMIs in check.
When selecting the tenure, also check the changes in the total interest payable based on your EMI choices. A long tenure is like to increase the total interest outgo as well, making the loan costly.
5. Find a Suitable Lender Offering The Lowest Rates And Charges
Once the loan amount and affordability is determined, you can proceed to select a suitable lender based on the interest rate levied and other pertinent features that make loan management easy. While sorting for lenders make sure to check their processing fees and other fees imposed on the loan. You must also ask about loan foreclosure, loan transfer and loan settlement facilities.
You can easily download an online loan app on your phone and go through their terms and conditions. You can also get in touch with their customer service representative in case of any queries or assistance. This makes your loan process much easier and smoother.
6. Apply Through an Online Loan App
Post determination of the lender, you can proceed to apply for your personal loan through a loan app. Applying through the app makes the entire financing process simple and quick with better chances of instant approval for the advance under a few minutes only. The eligibility and document requirements for these apps are also minimal and get processed conveniently.
It also makes it possible for you to apply and avail a loan through a loan app from anywhere. You just have to furnish the digital copy of your documents and provide the necessary details. Make sure to keep a copy of all your documents on the drive or cloud, so that you can have them handy at the time of an emergency!
Finally, when submitting your personal loan application, make sure to enter all the details correctly and to the best of your knowledge. Any errors or inadequate details in the application form can mean delayed loan processing. Also, applying through an online loan app makes documentation easy as they accept paperless document submissions for fast processing.