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Personal loans are one of the most popular sources of quick money. One of the hassle free ways to meet your monetary requirements almost instantly would be – availing unsecured loans. Despite the increase in its demand, there are many people who still shy away because of some misconceptions that they have heard and haven’t bothered to confirm. The point is to be aware of the real picture, so that you make the right choice when it comes to application and don’t falter.
Here are some myths about personal loans, debunked:
– Can a personal loan be availed if I already have a loan or a loan?
One thing that the lending institutions take into account is your ability to repay the loan you are taking. However, if you have a lot of loans or credit card bills, it does not mean that you cannot avail a personal loan. There is a facility called loan consolidation where you get the facility to combine your loans from different institutions into one personal loan. This will definitely give you better control over your loan burden as you will now be paying a single installment instead of several.
– Why are the interest rates unfair?
It is a fact that the interest rates for loans that do not require any guarantor are slightly higher as compared to conventional loans like secured loans. This is because these are unsecured loans that do not require any collateral or security, it is natural for banks to ensure that their money will be repaid. If you are keen to get the best available interest rate then you will find various seasonal offers which are definitely worth taking up.
– Can I apply more than required?
It is generally not a good idea to apply for any type of loan in excess of your repayment capacity. You may come across several agencies who claim to give you maximum loan amount (which is usually beyond your repayment capacity) to enjoy so called maximum benefits. Don’t be fooled by this as lending institutions never give approval if you exceed your repayment limit. Always remember, borrow only what you need so that a) you can save on unnecessary installments and b) you can easily avail other loans later if the need arises.
– Can I apply for a personal loan across multiple institutions?
Although it is not against the rules to apply for loans at multiple institutions, but if even one bank comes to know about your applications at different institutions, it will only further delay your loan availing process and lead to your rejection. will increase the chances. , Hence it is safer not to apply to multiple institutions so that you have the best chance of getting your loan approved.
– Is my credit rating the deciding factor for my loan approval?
Your credit rating is one of the important factors in getting your loan approved or rejected, though it is not the only factor that decides your application. Other factors like income, company category and overall profile score also play an equally important role.
There are many other questions going to cross your mind which is why you need to get in touch with the right people when it comes to your personal loan application.
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