One of the most simple and swift ways of borrowing money, is an online personal loan. Being an unsecured loan, an online personal loan does not entail an individual to pledge for collateral; thus nullifying the need for showcasing assets for sanction qualification. It can be easily secured through an online instant loan app which streamlines the process completely and maximizes the time-efficiency of borrowing money. Online loan disbursals allow the availability and receipt of money to be as simple as the process of the application itself.
Amongst the various needs that an online personal loan helps meet a prospective applicant’s financial needs include (but are not restricted to) renovating homes, travelling requirements, paying for higher education, consolidating debts, attaining the finances for a wedding and tending to different medical emergencies. The wide variety of requirements that an online personal loan solves therefore are many and the ease of attaining it and applying it through an online instant loan app makes it one of the most accessible ways of serving a multitude of monetary requirements and needs.
However, like most application processes there are several nitty-gritties which must be considered and evaluated before applying for an online personal loan. These complexities have been listed down as different Do’s and Don’ts for the ease of perusal for a prospective applicant, who plans to apply for a personal loan through an online instant loan app.
The Important DO’s include:
- Thoroughly Checking the Eligibility Criteria: It is also imperative to thoroughly check one’s eligibility by going exhaustively through the eligibility criteria that a lender has indicated when applying for an online personal loan. By going through the eligibility criteria on an online instant loan app, the applicant can completely eliminate their chances of getting rejected for the loan. As some of the protocols are absolutely important from a lenders perspective, it is strongly followed by most. In case an applicant fails to meet any of them, a subsequent rejection leads to a lowering of that individual’s credit score. This impact has adverse effects when applying for consequent loans, be it an online personal loan or a different loan type.
- Ensuring Comparison of Loans Amongst a Multitude of Lenders Before Applying: Lenders usually set their offering interest rates based on fund costs and credit profile of applicants. This leads to differing interest rates at which each lender provides an online personal loan. Therefore, in order to achieve the best outcome and the lowest interest rates, it is important to conduct an audit before factoring in on a lender who provides online personal loans.
- Knowing Exact Amount of the Loan Requirement: It is paramount to know the exact amount or a close estimate at a minimum, before applying for an online personal loan. This is integral, as even if an individual is eligible for a higher amount, applying for the exact amount curtails the need for paying an overall interest on a higher amount that the individual ultimately did not need. This makes the repayment of the loan easier from a borrower’s perspective and ultimately from a lender standpoint.
- Assessing Tenure of the Loan: Apart from assessing the amount of loan which an individual wants to apply, it is also necessary to evaluate the tenure at which the borrower must settle down on. This must be a tenure with which the borrower is comfortable with. Shorter tenures entails a higher EMI and the subsequent interest costs are lower. Longer tenures entail a lower EMI but lead to a higher interest cost. Therefore, the user must evaluate their comfort level before zeroing down on the tenure of an online personal loan.
- Knowing the Credit Score: A prospective applicant must know their credit score before applying for a loan through an online loan app. Knowing the credit score immediately provides perspective to a prospective applicant and helps them decide whether to go ahead with an application or defer it. A low credit score in all likelihood indicates loan rejection and a subsequent lowering of the total score.
The Important DON’Ts include:
- Avoid borrowing for requirements which might be deemed unnecessary: A prospective applicant should not apply for loans on spending which might be qualified as unnecessary. Expenses like shopping and other leisure based activities can be avoided. As aforementioned, an online personal loan might be utilised for renovating ones’ home, financing medical emergencies, financing higher education, arranging for an event like a wedding or even paying back consolidated debt. Any expense which can be classified under essentials warrant an online personal loan. These finances can be paid back by availing a personal loan albeit the applicant must also keep in mind all the relevant application criteria previously mentioned, such as eligibility and credit score.
- T&C evaluation must not be avoided: All the terms and conditions of the loan must be evaluated in detail before applying for an online personal loan. If an applicant has not correctly evaluated and read through the terms and conditions of the loan on the online loan app, there might be a possibility that the requirements of the applicant are not met in a real world outcome. Therefore, the applicant must evaluate all the terms and conditions carefully so that they are well-versed with the product offering, be it from whichever lender.
Online personal loan is an extremely simple way of borrowing and can be availed with ease. However, the above mentioned DO’s and DON’Ts must be known when applying for a personal loan so that the financial journey of an applicant is one of ease, rewards and growth. PaySense is an online loan app that is perfect for all your personal loan needs. It offers various benefits such as flexible EMI plans, zero credit history, instant approvals, quick disbursals and easy documentation.
Apply for Loans of upto ₹5 Lakhs easily using your phone or laptop, and pay back on low EMIs