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Tata Capital > Blog > Personal Use Loan > How to Choose the Best Personal Loan for Needs?

Personal Use Loan

How to Choose the Best Personal Loan for Needs?

How to Choose the Best Personal Loan for Needs?

The benefits of personal loan are manifold. There are no constraints on spending the sanctioned amount, the interest rates are lower than credit cards, there is no need for guarantors or security, and the paperwork is minimal. 

Apart from meeting emergency expenses, you can also refinance a high-interest loan or consolidate multiple loans with low interest personal loans. You can fill up a simple form online, on the respective lender’s website, and get quick access to the money you need.

Different lenders have different terms and conditions, which ultimately affect the amount you have to repay. Therefore, before you apply for personal loan, you should research well the options available online to find the best deal. Here is a checklist of the information that you need to verify to find out the best personal loan for your needs: 

Rate of interest

Interest rates charged by different banks and non-banking financial companies (NBFCs) vary significantly. The rate you will be charged depends on the stability of your income and your creditworthiness, as determined by your credit score. However, do thorough research and compare personal loan interest rates from different lenders to find the lowest rate. Even a slight difference can considerably reduce the amount you repay over time.

Additional Read:- Tips to Save Money Through Personal Loans

Eligibility criteria

Personal Loan Eligibility Criteria

For easy access to funds when in need and fast approval of the loan, select a lender that has the least stringent personal loan eligibility criteria. Look for a loan provider that does not ask for a very high net monthly income. The requirements pertaining to your work experience, age, and profession should be as relaxed as possible, so you can quickly be granted the loan. 

Associated charges

In addition to the interest rates, the total cost of your loan depends on factors like processing fees and other charges levied by the lender. If the associated charges like late payment penalties, additional interest on overdue amounts, check bounce fines, and service taxes are high, you will end up paying more than your estimate. 

Apply for personal loan from a lender that charges low processing fees and imposes negligible penalty and service charges. 

Flexibility of repayment

You might want to prepay a part of your personal loan to reduce your loan tenure or lower the amount you pay as interest. However, most personal loans come with prepayment charges. Find out the minimum amount that you can prepay and search for lenders that charge no fee for part prepayment. 

If you apply for a personal loan online from Tata Capital, you can enjoy the flexibility to pay lower EMIs at the start and increase the EMI amount when your income increases in the future. This can significantly help you repay your loan quicker.

Additional Read:- Here are Some Myths About Personal Loan Which You Should Ignore

Conclusion

In addition to the factors mentioned above, it is beneficial to choose a lender that takes the least amount of time to process your application and provides reliable customer support. For this reason, consider applying for an instant personal loan from Tata Capital so that you can benefit from its renowned after-sales service and quick disbursal time.

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