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Questions You Should Be Asking Before Availing A Personal Loan

By Author: Loan Adda
Total Articles: 1

Personal loan, being an unsecured loan serves for multiple objectives, which means that it is also considered as a multi-functional loan. It does not require any collateral, so for availing a personal loan you don’t need to provide any security to the specific lender from where you are availing a personal loan.
Before availing a personal loan there are few questions you should be asking yourself-

How much Loan Amount you require?
Before applying for a personal loan, it is essential to have an idea of how much loan amount you require, as according to that your application and eligibility will be checked. Plan out the total expense which you would be requiring for any particular reason for which you are availing a personal loan. As many times applicant, put a huge amount of loan requirement which is more than their eligibility due to which the applications get rejected.

How much is your credit score?
Credit score plays a vital role in availing a personal loan, as it gives an idea to the lender about your repayment history of previous financial products. SO, it is advisable that before applying for a personal loan, check your credit score, to have an idea about your financial history. As the lender check basic things like whether you have made any default payments or whether you have settled any loan or not.

How much is the Rate of Interest?
This is a major question to be asked, as rate of interest will determine the EMI amount which you’ll be paying on a monthly basis. It is recommended to check and compare from different lenders and loan providers about the rate of interest. So that you can get the idea of the best rate of interest and therefore, you can then proceed further.

Should you apply a personal Loan From a bank or an NBFC?
Traditional banks are there from a long time, while Non Banking Financial Companies is the new trend which has been started. The difference between is that the banks takes a lot of time in getting the process done, while in NBFCs the process is a bit faster. So have a proper knowledge about all the banks and NBFcs before apply for personal loan

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