If there was one thing a borrower could reduce, it would probably be their personal loan interest rate. Not without reason – this percentage is basically the cost of the loan and who wouldn’t want cheaper finance solutions, right? It’s no wonder then, that so many individuals put lower rates at the center of their comparison efforts; some even make it the main point of evaluation.
However, this is not the only number one should be concerned about. There are many other figures borrowers should go over before applying for a personal loan, 5 of which will be discussed below to ensure you are better prepared to enter into the borrowing process.
1. Your credit score.
Also pay careful attention to your credit score before you apply for a personal loan. One must check their credit rating even if it is above 750. Why? Well, because there is always chance that the credit bureau could make erroneous entries that bring down your score. This could end-up negatively affecting your eligibility. Moreover, if your score is above 750, there is always room for improvement. After all, the higher your credit score, the better you are able to negotiate for lower interest rates.
2. The processing fee.
Next up on the list of important numbers to keep in mind is the processing fees. You’ll have to pay this amount upfront with the application and it will most likely be 1 or 2 percent of the loan you’ve applied for. The important thing to keep in mind here is that the processing fee is non-refundable. It is the cost borne by the lender to evaluate your personal loan application. Therefore, even if it is found that you are not eligible, the processing fee will not be refunded.
3. Coming to eligibility.
Eligibility is another important figure borrowers need to be wary about before applying for a personal loan. Why? Well, because, if you apply above your eligibility, you could face the very real possibility of a rejected application. Also, as mentioned above, it will mean you paid the processing fee in vain. However, this huge setback is easily avoidable – one just has to use an eligibility calculator. This online tool will give you a near accurate estimate of your eligibility in seconds. You can then apply with peace of mind and confidence.
Check your EMIs before you apply. You might be eligible for a certain loan amount, but that does not mean, for certain, that you will be able to handle the EMIs applicable. So before you put your signature on the application, always use an EMI calculator. It will tell you how much the installments will be for every month of the repayment tenure. This will help you to plan things better and ensure you work your way out of debt in calm & hassle-free nature.
So if you ever find yourself in need of a personal loan, remember to keep these vital figures in mind before you apply. They will ensure you have a smooth borrowing experience.
Good luck and happy borrowing!