Ways To Compare Personal Loans Efficiently?

By Author: Aditya
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The decision to take a personal loan is a big part of anyone's life. The very first thing which comes in mind after opting to go for a loan is the selection of a trustworthy and suitable lender. There cannot be a guide who'll tell you exactly that which financial institution/lender can be ideal for the loan as every individual have his or her own requirement, financial status and choice.Sector is flooded with lenders and non banking financial institutions but, you should research about them before you apply in any of them.

When you choose a financial institution, you must understand that it is not only you but, also your family members might have an impact based on your decisions.But, how would you pick from these banks, financial institutions and personal money lender? In this blog, we will share our tips on how to compare and select the right lender for your personal loan.Loan comparison is not a simple process but you should take care of few things.Please remember we can only guide you but, the final decision in this matter really needs to be yours.

There are various factors based on which you can compare loans ...
... from various lenders. Here they are:

Loan Rates:

When it is about paying back money, how can we forget about rate of interest.Rate of interest are different for each loan company and hence it is essential to look for loan provider which offers best rate of interest.We all need lowest interest rate so that our EMI's are as low as possible

You can check the loan rates provided by lenders online but, it's advisable to go inquire about interest rates yourself.It is important to know that whatsoever is written on the financial institutions website might not be 100% true for you since your actual rate will be dependent on your various factors.For example, you have a good reputation of paying back your EMI's, then there is a good chance that you will get a lower rate of interest.The average loan rates range from 10% to 40% based on your credit history.

Lending Amount:

Personal Loan amount offered to you is different in almost every bank and financial institution.It is important that you just check with the bank or the lender about the amount of personal loan they can release as a personal loan.Let's say, if you need a low amount loan, then you should look for the banks whose range start from a fairly low amount of money.You'll find a few options when you are looking for large amounts such as 30 lakhs.

If you need a high personal loan amount then HDFC bank should be in your list.

Processing Fees:

The borrowers has to pay some some other charges to the bank in case of loans because loaners give these loans without any security in lieu of the amount borrowed.
The fees also commonly called processing charges.It is the loan provider which decides the percentage of the processing fee to be charged from the borrower.

For example, if your loan amount is 1 lakh and processing fee is 2%, you'll need to pay 2% of 1 lakh rupees (i.e. 2,000) as processing charges.Processing fees differ from bank to bank but, ideally it ranges from 2 to 2.5 % of your amount of the loan.if your loan amount is big then processing fees will have an impact on your pocket and hence should be a selecting factor of your lender.

Required Documents

Paperwork for a loan can be really frustrating sometimes but submitting your basic documents is essential for loan approval.Getting papers necessary for a personal unsecured loan should not be very difficult as it only require ones which we have already like Aadhar card, Tax proof and bank statements.Many times we come across a situation when we don't have the correct documents at the right time.So, having a look in the the documentation section of the lenders website will give you a clear picture of what documents are expected.

Eligibility Conditions:

First thing which a bank or an NBFC checks is your loan eligibility.There is no benefit of selecting a specific loan if you cannot complete its eligibility terms.If you have not checked the eligibility on the lenders site for loan, then please check it now.This can be really frustrating because, if this is ignored because you eventually end up wasting lot of time and effort for almost nothing

So, our advice is to do all the checks about this first.

Payback option

I usually stay away from taking personal loans because it gives me a worry to pay a specific amount every month.Is personal loan EMI's amount is pain in your ass?. There are options to step up the payment, step-down the equated monthly installments and part payments from banks making it easier for clients to repay the loan installments without defaulting It is best to compare the EMIs and payment options before applying for the personal unsecured loan.Not every loan providers will have all types of repayment options so, it is usually a good idea to discuss this when applying for a personal unsecured loan.

You may like to read Things to keep in mind before applying for a personal loan.

Tenure

EMI calculators can be found on all banks website to calculate your EMI amount based on simple inputs like amount, rate and loan tenure.In a longer payment duration, your equated monthly installment will likely be much less which can become a burden on you.Don't worry, your financial institution will definitely offer you an option to decide your loan duration but, it may have some dependency on the credit history.For example, you can opt for a flexible duration ranging between one to five years while taking Capital First personal loan.You can find information on forums and question and answers websites such as Answers.com.

Default Charges

Every person who's got the right intention will pay his or her loan EMI's in a timely manner. However, if there is any default, then that can be due to some unanticipated reason.Loan providers also understand this fact. That is why there are certain penalty charges which are fixed by lenders in case of missed repayment.You need to research and do a comparison of the loan offers on this basis irrespective of how much optimistic you are about your punctuality or pay back ability.The charges are decided simply because financial institutions also suffer from a loss due to your delayed payment. In that case, it's actually a way of ensuring safety from any loss by the nbfc's.As we pointed out earlier, penalty can vary from bank to bank as well as dependent on your rate of interest and days you have defaulted.Financial institutions are always very clear about all these factors on their website or the docs which you sign.Unfortunately, people overlook these factors at the time of personal loan application and pay the price when time comes.

They believe that the most important thing is to have the loan as early as possible.But as an informed consumer, we have to research properly in advance.

Your Loan Advisor is best Advisor in market for best advice and solution for Personal loan. You can also check Points to consider while taking a Personal Loan.