Analysts and researchers from around the globe are busy comparing costs of personal or individual loans. Banks and financial institutions provide personal loans to individuals or business enterprises.
The cost of acquiring money to finance your requirements is also considerably high. India is undergoing unprecedented expansion regarding market growth thanks to commercial banks and other financial institutions. Individual loans are now easier to acquire, and home loans alone account for more than 12% of overall bank credit.
Research shows that bank credits are constantly rising although there are reports of single digit bank credit figures as well. According to economists, banks and financial institutions suffer from stagnant NPAs and debt market migration.
The absence of proper collateral often furthers loan approval rejections. However, personal loans are often unsecured and do not require security assets. Rates of interest for these loans by banks and financial institutions vary.
How to apply for Personal Loans Correctly?
1. Minimum Eligibility Criteria:
Banks and financial institutions advance personal loans to interested parties only when basic eligibility criteria are sufficed. Typically, institutions refer giving loans to individuals falling in the age group of 21-60.
2. Reasonable Amount:
One should apply for a reasonable amount corresponding to one’s repayment capacity. This depends on an individual’s employment type and income status. Banks and financial institutions offer loans based on repayment capacity and not on one’s savings and persuasion capacity.
3. Maintain Appropriate Credit Score:
A decent credit report (e.g. CIBIL score) furthers chances of obtaining personal loan. Experts believe that individuals should work towards improving their credit scores and increase their chances of receiving private loans.
4. Maintain Decent Credit History:
Wonder who has been watching you while you were happy about never missing an EMI? Starting from your credit card bill statement to disciplined net banking transfers, a decent credit history betters your chance of receiving a personal loan.
5. Avoiding Multiple Loans in Different Institutions:
Potential borrowers should refrain from applying for loans in multiple financial institutions before asking how to apply personal loan at Bajaj Finserv. While dissecting your credit history, lenders look for existing loans and current loan applications. That can exaggerate your desperation and owing to its potential credit risk, is liable to be rejected.
6. Stop Applying for Fresh Loans Without Paying off One:
Lenders prefer individuals who are free from current debts. The probability of successful loan repayment deepens if borrowers have the previous history of successful repayments.
7. Maintain Complete Information Symmetry – Attention to Detail:
Potential borrowers can expect successful loan approval if they provide all their details correctly and then inquire about how to apply personal loan. Apart from basic information, lenders need to know about your salary, existing loans (if any) and credit score. More recently, it is mandatory for borrowers to submit their KYC documents and salary slips.
8. Insuring Your Loan Repayment:
Personal loan repayment insurance services can help borrowers insure their repayment and cover their monthly loans in case they remain unpaid. Although experts do not often recommend loan repayment insurance, borrowers may look for the cheapest deal and get their repayments insured.
9. Choose Simpler Forms of Credit:
Apart from personal loans which might drop down to housing/vehicle loans, credit cards also turn out to be beneficial for smaller sums. Credit cards offer lower interest rates and are payable in easy instalments over a longer time period.
Evidently, loans are no child’s play since a considerable chunk of NPAs comprises of Personal Loan in India non-payments. Therefore banks and other financial institutions like NBFCs undertake thorough inspection prior to loan approval. After the personal loan approval process you receive your amount directly in your account.