Personal Loans are one of the most popular financial products in the market and are highly popular amongst all people who are facing a temporary cash crunch and need money urgently to take care of urgent expenditure. Personal Loans in India are offered by a large number of financial institutions.
These loans are generally unsecured,i.e., you need not furnish any security in order to securitise this loan. The tenure for Personal Loans extends up to 60 months,andthe rates of interest vary from lender to lender. The maximum amount available as a Personal Loan can go up to as high as Rs. 50 Lakhs. What makes these Personal Loans highly sought after is the fact that you can use the amount as per your requirements and need not inform the lender about the final usage of the money.
How to apply for a Personal Loan?
With the rapid progress of technology in the financing industry, a large number of lenders are now following the online Personal Loan application process. Herein, if you want to apply for a Personal Loan, then you just need to visit the website of the particular lender from whom you want to avail the facility or any of the multiple online finance marketplaces like MyMoneyMantra. Thenyou merely are required to fill out an online form with some essential details to apply for a Personal Loan. The entire process is normally accomplished within 24 hours,and the money is transferred to your bank account within a few working hours.
Renegotiation for better terms on a Personal Loan
Sometimes when your financial requirement is desperate, or your credit score is low, you end up taking up a Personal Loan at a higher rate of interest. But with time when you repay your Equated Monthly Instalments (EMIs) on time and take other measures to improve your credit score, you realise that you can now access much better offer in the market on a Personal Loan, which offers significantly lower rates of interest as compared to what you are already serving.
Renegotiation for better terms on a Personal Loan is a highly recommended step to reduce the interest burden on your finances as well as lowering the EMI. Here are 5 essential tips that you must follow to renegotiate for better terms on your Personal Loan:
- Check your credit score
In order to be on a strong footing while renegotiating the terms on your Personal Loan, you must have a good credit score (ideally above 700). So, you must take out your credit report and check if your credit score is above the required threshold of 700. If the credit score is below 700, then you must drop the idea of renegotiation of loan terms as of now and instead focus on improving your credit score, which might take a minimum of 4-6 months and also require you to seek help from a professional.
- Review the loan agreement
If your credit score is above the required threshold, then the next step for you must be to review the Personal Loan agreement. You need to understand if there are any lock-in periods, foreclosure charges or any other expenses that you will have to bear in case of renegotiating or transferring your existing loan. These expenses might add up to a significant amount, so you must read it thoroughly.
- Look around in the market
It is a must do step for you. You must make sure that you do your research and look around in the market to collect information on the prevailing PersonalLoan interest rates. You need to remember that even a slight reduction in the interest rate can result in significant savings for you. You should also consider the option of balance transfer and gather all information about it.
- Talk to your existing lender
Before you take any decision regarding balance transfer or any other option, you must talk to your current lender about your plans and ask if they are willing to lower the interest rates for you. Be prepared with your financial documents and credit report in support of your argument. Most likely your lender would not want to lose out on a regular customer and would be willing to make some relaxations for you, if possible.
- Try other options
There are various other options that you can exercise to get better terms on your loan such as debt refinancing or paying off the loan early. There is no use of keep paying EMIs for a loan whose terms you are not comfortable with; it makes sense to pay off the loanearly and save on interest costs.
Personal Loans offer you an excellent opportunity to improve your financial situation without having to use up your personal savings, but you must keep a close eye on the interest rates in the market,and whenever you feel that you can get a better deal, you should go for it.
To apply online for Credit Cards, Secured Loans and Unsecured Loans, visit www.mymoneymantra.com, the leading online lending marketplace that offers financial products from 70+ Banks and NBFCs. We have served 2 million+ happy customers since 1989.
Talk to our Loan Specialists toll-free at 1800 103 4004 to know more about our products and offers.