Personal loan is usually taken to meet emergency expenses or to fulfil needs for which you do not currently have the money in hand. It’s a great way of securing some money when you need it the most. However, it is important to be smart and make the most out of the loan.
• Any debt is bad. Strive to pay off your loan in the shortest time possible. The longer the tenure you take, the higher will be the interest cost of the loan. Use the EMI calculator to understand the interest component of your loan
• Never take a loan for which the EMI is unaffordable. It will land you in a debt trap which may be extremely difficult to come out of.
• Do not apply for the loan to multiple banks. Every time your bureau score is pinged by a bank, the score is reduced by some margin, and the chances of getting the loan is reduced. Check for the offers available to you on Rupeepower and apply for the bank of your choice.
• Ensure you pay the EMIs on time. Missing payments not only impacts your bureau score (and thereby your chances of getting loans in future), it also increases the interest burden.
• Add on features like no prepayment penalty are great as they allow you to close the loan sooner without having to pay any additional charges. Look out for providers who offer more add on benefits.
Use the tools available and plan your finances smartly to ensure you are prepared to meet the EMI commitment you are going to make.