Personal loans offer financial support to individuals facing a cash shortage. It can be used for debt consolidation, meeting daily expenses, medical bill payments, and many other things. A personal loan is convenient in an emergency. However, many borrowers do not make a considered decision. They take a personal loan from the first lender they come across without considering the interest rates and processing charges. As a result, they regret it later when the lender applies hidden charges on personal loans. Borrowers must consider some vital factors to choose the right lending institution. Here are the most crucial factors to consider when choosing the right personal loan in India.
Table of Contents
1. Loan interest rates
Let us say a lender approaches you with a personal loan instant approval scheme. The lender offers an interest rate of 15% on personal loans in India. Since you haven’t heard from other lenders, the offer might seem lucrative. However, many lenders will offer an interest rate of less than 15% on personal loans. For example, Fullerton India is a popular lending institution that offers personal loans starting with an interest rate of 11.99%. Therefore, one can make a prudent choice only after comparing the interest rates of different lenders.
The interest rate is directly related to the cost of the personal loan. When the interest rate is high, the personal loan becomes more expensive. Every personal loan EMI will include interest charges applied to the principal balance. A borrower might end up paying more interest charges throughout the loan tenure by making a wrong choice. Thus it is advisable to compare the offers from reputed lending institutions before selecting one.
2. Loan fees and other charges
The interest rate is not the only thing that makes a personal loan expensive. The lender may also apply various charges. These can be loan processing charges, late payment fees, loan cancellation charges, foreclosure charges, service charges, and cheque bounce penalties. The borrower must compare these charges applied by different lenders. The idea is to choose a transparent lender that does not add hidden charges to the personal loan. All the involved costs must be known beforehand to the borrower. With Fullerton India, the processing fee for personal loans can range between 0% to 6% of the loan amount. Also, Fullerton India ensures that no hidden charges are applied to personal loans.
3. Repayment period
The repayment tenure is another essential factor to consider for choosing a reliable lender. Some people are stuck with lenders that do not offer flexible repayment tenure. The borrower must be given the right to choose the repayment tenure for their loan. Sometimes, the borrower might feel the EMI amount is too high. In such a case, the borrower can increase the repayment tenure and decrease the EMI amount. However, an increased repayment period means more interest charges at the end of the loan.
Some borrowers might want to repay the loan early. Such borrowers must be allowed to choose shorter repayment periods. Fullerton India is well known for its flexible repayment periods for borrowers. It will enable borrowers to foreclose their loans when required. Before personal loan instant approval, one can use an online EMI calculator to decide on the right repayment period.
4. Eligibility criteria
It is essential to know the eligibility criteria of a lending institution. Why choose one with complex conditions to acquire a personal loan? Some lenders have complex rules for personal loans. They might ask the borrower to furnish many documents to secure a personal loan. They might verify the borrower’s details for days which might delay the loan approval process.
In this modern era, there is no need to wait for days to secure a personal loan. Fullerton India allows borrowers to apply online for a personal loan via its website. Also, the age and income conditions of Fullerton India are simple and can be met easily.
Conclusion
The processing fee for personal loans, interest charges, and many other things can make a loan expensive. There is no benefit in making a hasty decision and securing a personal loan. Take your time and compare the charges applied by different lenders in India. Apply with Fullerton India for the minimum interest!
