It is normal to find yourself in a financial lurch. At such times, consider availing of a personal loan to tide over the situation. By availing of the best personal loans, you can complete a stalled project, improve business or even fund your education. You can get personal loans from banks, NBFCs, online lenders, and credit unions.
The very thought of a personal loan triggers the image of a bank. Not only do these financial institutions enjoy a widespread presence, but they also offer reasonable interest rates. Through their network and branches, even in remote areas, you can gain access with ease anytime and from anywhere.
However, banks follow strict guidelines while approving loans and rarely offer a personal loan without a CIBIL score. They consider applicants without CIBIL as high risk and hence charge high-interest rates on personal loans.
Entities forming this sector include companies that engage in investment, asset finance, housing finance, financing of infrastructure, and so on. Approach them when you come face to face with a cash crunch that seems inevitable delta math. NBFCs might be lax when granting a personal loan without a CIBIL score. But the sector as such does not offer a one-size-fits-all solution. So, you must set aside time to explore what each NBFC offers in terms of interest rates, processing charges, and repayment tenor.
Best described as member organizations, these provide the best personal loans at interest rates lower than those offered by banks.
This is another option to get a personal loan without a CIBIL score. Their terms of giving out loans are not as stringent as those levied by banks. With online lenders, even those with bad credit scores can access loans, and all that you need to do is search the internet to get a list.
Unlike banks, online lenders go lenient on credit scores and offer products for borrowers having no or low CIBIL scores. That being said, they also minimize the risks involved by levying higher interest rates and, at times, even asking for collateral.
Personal loan nuances
Consider factors like interest rates and monthly instalments before you go for a personal loan. As far as possible, opt for the best personal loans that feature favourable terms, an example being Bajaj Finserv EMI overdue charges. Although this aspect may not seem significant at first, it could make a lot of difference in unprecedented circumstances, when non-payment of monthly instalments could invite a penalty.
Discussed as follows are Five ways how to grab the best personal loans –
1. Check your credit score
A credit score plays a vital role when getting a personal loan. You can be sure of easily getting a personal loan with a high credit score. You can also bargain for lower interest rates. On the other hand, if you have a bad credit score, getting a loan would be difficult unless you are willing to settle for a high-interest rate or collateral.
Checking your credit score reveals the kind of lenders to approach. For example, while you cannot ask a bank for a loan with a bad CIBIL score, you can surely try asking an NBFC.
Pre-qualification helps you learn the loans you qualify for in advance. Nowadays, lenders provide an online app where you can feed in personal details, including your credit score, income, and employment history.
3. Put together the required documents
Usually, lenders implement several rules and regulations while considering applications for the best personal loans. Therefore, prepare to spend time gathering and arranging the requisite documents before submitting the loan application form.
4. Compare lenders
Factors such as terms, conditions, and interest rates vary from one lender to another. While some may be strict, others could be comparatively lax and lenient. When comparing lenders, it is easier to spot the best deal by checking individual components like interest rates, monthly instalments, penalties, etc.
5. Compare loan options
Courtesy of the competition in the financial sector; lenders invest heavily in marketing their financial products. On your part, you can go through the various marketing campaigns to check multiple loan options and weigh them against each other. In this way, you can identify one that best suits your requirements.
A common mistake people make is signing the loan form without reading the fine print. Tedious though it might seem, there is plenty of important information that you should be aware of, and hence do make it a point to go through it at least once.
Signing on the loan application implies that you have agreed to the mentioned terms and conditions indicated in the application. Since the devil is in the details, you will have gleaned crucial information by going through the fine print. Aspects covered include interest rate, penalties given in case of default, and other seminal areas.