Personal loans are one of the most popular modes of financing available today, especially since there are no restrictions on how a person may use the money. Consequently, borrowers can easily avail these loans to fulfil their financial necessities, irrespective of their financial emergency.
A recent study revealed that India experienced major growth in personal loan applications over the last few years, with data between 2017 and 2018 suggesting a 20.4% increase in such loans. Furthermore, from 2015 to 2018, a compound annual growth rate of 27% was observed across all unsecured loan categories.
With growing numbers indicating rising popularity, potential borrowers must learn how to apply for personal loan. Before going on to its application process, however, it is important for borrowers to follow these steps mentioned below. They will ensure that an individual applies for the best loan option, while also planning its repayment, adequately.
Understand how much you need
The first step while applying for a personal loan is assessing requirements. Loan approvals and interest rates are often decided by a financial institution based on the loan amount. Additionally, applying for a high loan amount leads to higher interest payment. Thus, borrowers should limit the principal for such a loan. Applying for their minimum requirement should keep the cost of credit low and ease repayment.
Though not mandatory, it is advisable for loan applicants to plan their repayment before applying for a loan. Borrowers should look for methods of how to plan their personal loan EMI repayment better. Doing so will help an individual learn about his/her exact debt, which, in turn, should help determine the most suitable principal and loan tenor.
Check eligibility criteria
There are quite a few eligibility criteria, which financial institutions check before approving a loan application. While the foremost is an applicant’s CIBIL score, there are additional requirements, including financial and employment details.
For instance, availing a personal loan without income proof can be difficult. Thus, checking eligibility criteria beforehand helps since it reduces the chances of facing credit rejection.
Compare loan options
Once an individual has decided his/her loan amount, it is imperative that they compare every available loan option. This includes comparing interest rates, features offered, etc. A convenient method of comparing fast personal loans is through an online personal loan EMI calculator, which reveals the monthly burden and total interest payable on a line of credit.
When looking to avail a personal loan, applicants need to furnish a set of documents to the lender. Thus, it is advisable to arrange all necessary documents from before to save time during its application process.
Keep in mind that the personal loan verification process is not as long as that of secured loans owing to minimal document requirements.
Once all these steps mentioned above are completed, borrowers can apply for their personal loan with ease. Typically, financial institutions like Bajaj Finserv and others provide pre-approved offers which make loan applications convenient and fast. Such offers are provided on many financial products like personal loans, business loans, educational loans, etc. You can easily check your pre-approved offer by providing your name and phone number.
The application procedure can be completed by following these steps below:
- Applicants should visit the official web page of their financial institution.
- After selecting their choice of loan, personal details including financial and employment details should be filled in.
- Finally, KYC and other documents should be submitted as instructed by the concerned financial institution.
After completing the application process, financial institutions confirm approval within minutes. Furthermore, another advantage offered on fast personal loan options is that of money disbursement, which is also completed promptly within 24 hours.
Timely repayment of these loans is vital, especially since these unsecured loans have higher interest rates than their secured counterparts do. Consequently, a default of payment can lead to higher penalty charges.
Additionally, missing EMI payments also negatively influence the credit score of an individual, which is detrimental for future loan applications. After availing such a loan, one should be careful to avoid any mistakes when it comes to repaying the debt.
Borrowers also have the option for part prepayment of their fast personal loan, which allows them to pay lesser interest. With a reduction in time and number of EMIs to be paid, this is an effective method to reduce the total loan repayment burden of a borrower.
Bajaj Finserv, one of the most diversified NBFCs in the country, offers fast personal loans with a completely online process that allows you to avail the money you need without having to leave your home. All you need to do is check if you qualify for a pre-approved personal loan offer, and if you do – decide how much you’d like to borrow. You can get the money in as little as 20 minutes.
Just visit the Bajaj Finserv website and get the money you need right away!