Compare with the Other Banks: Always do a thorough research before choosing the bank/lender for your personal loan. Never say yes when a bank promises for a lower rate of interest, since it might have hidden charges. You need to check if the bank is offering fixed rate, floating rate, annual reducing balance rate, etc., and then analyze which will suit you the best on the longer run! Compare various offers from a minimum of 4 to 6 banks.
Here are some tips to help you find a Personal Loan that suits you best:
Compare interest rates: An important step before deciding which bank to take a loan from, is to do some research on Personal Loan terms of different banks and compare the interest rates. There are many ways to do this – you can either do your own research by going to the websites of different banks and finding out their interest rates, or go to financial websites such as BankBazaar that will give you all the required information based on the requirements you provide.
Compare fees and charges: Interest rate is not the only thing you need to compare when choosing a Personal Loan. You also need to look at the various fees charged by the bank. The fees usually associated with a Personal Loan are: processing fees, late payment charges, cheque bounce charges, loan cancellation charges and GST for each service provided by the bank. Of this, the most important is the processing fee, which usually is between 1% and 3%.
Look for repayment flexibility: Most Personal Loans come with full and partial pre-payment charges. This means that if you want to pay off the outstanding amount of your loan before the tenure ends, you will have to pay a small fee. Some banks charge no foreclosure fees, but most banks charge between 2% and 5% of the balance amount.
Find an EMI you can afford: Before you take a loan, you need to be sure that you will be able to make regular repayments to close the loan on time and without any penalties. For this, you need to know an estimate of the Equated Monthly Instalment (EMI) that you will have to pay on the amount you borrow. Knowing your approximate EMI is easy when you use an EMI calculator. BankBazaar’s comprehensive EMI calculator allows you to factor in details such as loan amount, tenure, interest rate, processing fee and pre-payment possibilities. By entering the respective values, you will get an idea of the amount that will get deducted from your account every month as EMI. The higher the amount, the more the EMI you will have to pay. Ensure that your total EMI deductions in a month are not more than 50% of your income. For example, if you’re monthly income is Rs. 50,000, all your EMIs put together should not exceed Rs. 25,000.
Examine other loan possibilities: Personal Loan is not always the only way to get yourself through an emergency. Approach friends and family to see if they can lend you money, especially if the amount is not large. This way you can do away with the whole hassle of getting a Personal Loan and paying interest. However, you also need to be wary of the fact that having monetary dealings could sometimes ruin relationships. So if you take an interest-free loan from a family member, ensure that you pay them back promptly.
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If you really looking for funding you must try crowdfunding or any business funding services company to have capital. There are many service providers available online. You just need to decide what services you are looking for.