Before applying for a loan there are certain things that you need to check. This will ensure that you do not make losses and also will not disappoint you in case your loan is rejected. Here are 6 things that you must check.
Evaluate Your Finances
Don't go for a loan just because you can afford to pay the EMI from your salary or from your other sources of income. Loan entails processing fees and interest, which can make them really expensive, especially personal loans. Go for a loan only when you really need it.
Do not forget your Cibil score
Check your Cibil score before you apply for a loan. This will ensure that you are not disappointed in case your loan is rejected or a lesser amount of loan is sanctioned.
Use online portals to compare
Variance in interest rates can mean a lot, especially in large sized loans like home loans. It is best to compare loans online. There are many portals that allow you the facility to compare loans before you take them.
Check your own ability to service loans
Please check your own ability to service the loan. Sometimes, you may not be able to pay the EMI because of other outstanding loans or poor take home salary.
Cash flows and period of loan
If the tenor is increased the loan payment period is lesser. So plan accordingly based on your cash flows.
Compare processing charges
Many banks waive off processing charges during festive seasons. At other times the processing charges differ from banks to banks. In general government owned banks like SBI or more reasonable in terms of these charges.