cashkumar - ten mistakes while applying for a personal loan

Cashkumar - https://cashkumar.com/personal-loan-bangalore

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https://cashkumar.com/personal-loan-bangalore









To get the best deal for your personal loan requirement With regard to Rate of Interest

Tenure

Pre-closure, part payment, etc.

To ensure that we do not default/ delay payment unintentionally

To ensure we do not misread fine print

And many more

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We will split the learning into 10 smaller slides

The ideas is to imbibe each point well before we move to the next point

We have got feedback from multiple people who have made one or more of the mistakes highlighted

Share your experience on any of the instances or mistakes made by you in the comments section below

Let us all learn together











Don’t take the first offer that comes your way!

It might be an offer from the bank you hold existing relationship with

You might get a handout regarding the loan offer while you visit the mall

Or you might get a call from one of the financial institutions saying you have a pre-approved loan offer

No doubt you might get a loan through these channels but the probability of it being the best offer is very minuscule











The interest rate and other fees will be offered to you based on your eligibility

Your eligibility will be based on several factors like your monthly take home, salaried/self-employed, company you work for, your current EMI commitment etc

Leverage technology to explore the best offer based on your eligibility and compare the offers from several banks with the help of platforms like Cashkumar

Just by entering few basic details and requirements, these platforms will give you the details of banks you are eligible for and the interest rates offered

This process is simple, saves your time and helps you grab a great deal!


https://cashkumar.com/










Stop focusing only on Interest rate while you are shopping for the loan

Other than the interest rates, there are several charges applied by banks such as processing fees, pre-closure fee and so on while lending the loan.

Be aware of all the charges before accepting the offer as the chances of you going with the right offer is minuscule if you concentrate only on Interest rate

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Lets take an Ex:– You need personal loan for Rs. 5,00,000/-. Bank A is offering ROI -14.5%, processing fee - Rs. 999 & no pre-closure charges while Bank B is offering interest rate -14%, processing fee -2% & 3% and pre-closure fee of 5%.

If you are looking to pre-close the loan, Bank A will be the wise choice though the interest rate is slightly high.

If you are looking at complete tenure then Bank B makes sense. Therefore its not only the interest rate which matters!

You can visit Cashkumar to check the fees and rates offered by several banks.

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Have you ever wondered why lending institutions make you sign at dozens of places in the agreement?

So every signature of yours is primarily accepting some T&C highlighted in that section or page

There are several T&C under 4 main sections on the loan agreement and those sections are : The interpretation/definitions section

The mechanical section

The transaction-specific section

The boilerplate section

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These sections contain the details and T&C’s on the below important aspects of the loan:

DISBURSEMENT OF LOAN AMOUNT

CALCULATION AND PAYMENT OF INTEREST

REPAYMENT OF LOAN AMOUNT

SCHEDULE OF LOAN AMOUNT REPAYMENTS AND INTEREST PAYMENTS

PAYMENT OF AGREEMENT FEE

CALCULATION AND PAYMENT OF DEFAULT INTEREST

INSURANCE

OBLIGATIONS OF BORROWER

CANCELLATION OF LOAN AGREEMENT and

OTHER TERMS AND CONDITIONS

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Its very important to understand these T&C’s before you sign the agreement.

So do not just skim through the agreement with urgency to get done with the paper work

It would always help to go through the finer points to ensure there are no surprises on a later date.

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How often have you heard about customers defaulting loans because they don’t have the ability to repay loan?

This is because they miscalculate their potential of repaying a loan while borrowing

If you have a good credit history and eligible for a loan, several financial institutions will call you selling loans and offering you the higher loan amounts upto your maximum eligibility



While it is definitely good to know that your are eligible for higher loan amount and see money inflow to the account, you might want to consider your repayment abilities based on your personal commitments

Its very important to account your current personal commitments, other EMIs that you are paying etc before deciding on the loan amount

You can also use EMI calculator to check the monthly EMI you will have to pay on the loan and decide on the loan amount


http://emicalculator.io/


Any delay in payment or default due to loan burden will hit your credit score badly and bring down your chances of getting further loans in future

Therefore don’t overboard your self and you can always take a top up loan if need be



Say you want a travel loan for 2lakhs, tenure 3 years to visit Dubai with your loved one

You are working with one of the top MNCs and earning 50k a month and for sure you know you will get a good bonus at year end as you have performed extremely well this year.

And you plan to pre-pay or part pay your loan with the bonus amount, which is a good option to get done with your liability.

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Cashkumar – Personal loan interest rates

https://cashkumar.com/personal-loan-interest-rates

When you approach bank to pre-pay the loan, they might reject this saying they don’t have pre-pay option or the cost of pre-payment is very high. This will end up being a great disappointment

Therefore when you are applying for a loan, its good to estimate your repaying capability by considering your incentives, bonus etc and more important to look for a bank who has pre-payment and part payment option with zero charges or lesser fees

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Never miss this point in the application form in case you are looking for an early closure

Cashkumar clearly highlights all these parameters on the site which would help you take an informed decision

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You are in a urgent need of cash and have applied for loan, you know that your loan will be rejected if you say that you are staying in a PG. You decide to give incorrect information to bank saying you are in rented house with family and try to get an fake rental agreement from your friend who rents a house and submit to bank.

If you are thinking this is a easy way out, it’s

a big NO NO!

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Never hide information or lie to the lender while borrowing

This could hurt your credit rating or lead to a legal case which sure is not worth the trouble.

You might not only be forced to repay the loan immediately but also be charged a hefty fine for this fraudulent act

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Its not ethical to borrow by hiding information or lying.

You can always check your eligibility through platforms like Cashkumar and check which institution will be happy to lend you based on your eligibility and apply accordingly.

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Credit score is a rating which indicates person’s credit worthiness and this is published by CIBIL based on person’s credit history.

The score ranges between 300 – 900, which is derived by CIBIL through statistical algorithms using individual’s credit history for atleast past six months which includes borrowings, repayment patterns, defaults in repayment and other data relevant to a person’s creditworthiness

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Its easy for a person with good credit score to get a loan, provided he meets the banks eligibility criteria.

If a customer has Bad credit score, applying for a loan would further hamper his Credit score due to the inquiry placed by the financial institutions

In India each loan request via a Bank or NBFC would take a hit of about 5 to 10 points on your CIBIL score (credit score).

Multiple rejects could hamper this further.

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It is also difficult to get a loan even if you don’t have a CIBIL score i.e. -1 or 0

It is always advisable to check your CIBIL score before applying for a loan and also ensure the same is rectified in case of any issues.

You can get your CIBIL scores and CIR online in official CIBIL website www.cibil.com.

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http://www.cibil.com/











While investing is a good thing, taking a loan for risky investments might not be a good idea

Few customers take personal loan to make some risky investments in Equity markets or the likes

This can increase your returns when markets are rising but losses can be devastating when the markets fall.

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https://cashkumar.com/personal-loan-mumbai








Below are few reasons how this can be risky

The income you receive from the investment may get lower than you expected

Interest rates on the loan could rise. If they rose by 2% or 4%, you might get in trouble

What if your income ceases due to sickness, injury or redundancy

The value of your investment may fall and the proceeds from the sale may not cover the remaining loan balance

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Therefore a wrong pick or change in the Macro or Micro Economics could take a toll on the investment and hence your loan.

Make sure you keep this in mind while borrowing.

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When the bank representative is sitting across you, please do not hesitate to clarify all your queries however silly they might sound to you

Not everyone will understand all the Terms and

conditions in the application, so its absolutely ok to clarify any doubts

There will be several sections in the T&C

regarding the Loan amount, Calculation and payment of interest, Repayment and several other fees, Insurance,Pre closure and part closure

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Make sure you understand all the details before signing the agreement

This will ensure that there are no assumptions which in turn avoid any surprises going forward

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Remember those signatures on the agreement reiterate the fact in multiple ways that you would not default. So put in your best efforts to ensure that you do not default or delay the EMI payment.

If you default or delay the payment on loan, this will drastically take down your credit score and chances of you getting further loan will be very less

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Hope these ten tips helped you and you will not make these mistakes while applying for a Personal loan

With these key points you are well equipped to apply for your personal. So go ahead and choose what’s best for you.

Please do share your feedback and any points you have regarding this subject which will help us learn together.

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Thank You!









cashkumar - ten mistakes while applying for a personal loan

Economy & Finance