Availing a loan is not just an access to a line of credit or new funds for a person, but it is linked to dreams, and goals. Securing a loan with conditions that best suit your financial needs is always nice. It is then natural that you would want to consider the decision from every angle before finally taking a decision. To ensure that you make a wise decision when applying for a loan, it’s essential to understand the fine print about the loan approval process and the lender.
These days, with almost all banks and non-banking financial companies (NBFCs) reaching out to customers with loan offers it could be difficult for a borrower to decide on the lender and the loan offer. At the same time hidden charges, complex documentation processes, and high-interest rates could be a problem for those who are in urgent need of money.
Here are a few simple tips you should follow while finalising the lender and the loan offer to avoid any hassle in the future.
Borrow only what you need: Before applying for a loan, check how much you need and what amount you will be able to pay back comfortably. While calculating this, keep in mind your other financial commitments such as health insurance premiums, other EMIs, credit card bills and other monthly expenses.
Borrowing more than you need can result in unnecessary debt and strain your resources.
Explore best payment options: There are numerous payment options and schedules available today. They often vary from lender to lender. Finding a repayment and EMI plan that best fits your financial situation is important.
Compare interest rates: The interest rate can vary depending on the kind of loan you are taking. Since these are often monthly payments, even a percentage point difference can add up to a big amount. It is important to look for the lowest interest rate you can get for the amount you want. IIFL Finance, for instance, offers the lowest interest rates for gold loans, home loans, and personal loans.
Forget to read the fine print: It’s important to understand all the terms and conditions on the loan document. Lenders could bury extra charges in complicated words behind lots of paperwork. This could cause trouble later on when your repayment amount balloons up.
This article is a sponsored feature by IIFL. Money9 does not take any responsibility for the content and any profit or loss suffered by the readers. All readers are advised to consult an investment expert before making any investment decision.
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