Getting approval for an online personal loan from an NBFC can be tough because the process can get complicated and confusing, especially for new borrowers. Applicants must look at many aspects before getting into any personal loan because lenders implement many terms and conditions. Lack of study about the details of personal loans, their interest rates, and associated conditions can lead to loan application rejection and financial mishaps. Also, a thorough comparison of different lenders is essential to a personal loan at the desired interest rate and with favorable conditions.
This article lists the tips and tricks to get your online personal loan application approved at an NBFC.
Tips for Successful Loan Approval at NBFCs
Follow these tips and get your loan approved in no time!
- Do a Thorough Research.
The first task for the first-time borrower before applying for an online personal loan at an NBFC is to get the research done. Evaluate yourself as a borrower and the available lenders. Furthermore, gather knowledge on the lenders and try to assess their trustworthiness.
- Evaluate Your Loan Requirements.
One should check their financial requirements before applying for an online personal loan. The first thing to ask yourself is the purpose of applying and whether the loan is for the short or long term. Also, plan how you are repaying the loan as well. Doing this evaluation will help you to manage your financial status better.
- Check Your Credit Score.
The three-digit credit score or CIBIL score ranges from 300 to 900, which tells about the borrower’s creditworthiness. A credit score of 750 or above is a good indicator, which signifies that there are more chances to get a higher loan amount at lower personal loan rates. However, in case you are a new borrower, you won’t be able to fetch a credit score. Hence, it will show as NTS (New to Credit).
- Check the Eligibility Criteria.
The lenders set certain eligibility criteria regarding the applicant’s age, income, employment status, experience, etc. The applicants must meet those criteria before applying for an online personal loan.
- Compare the Interest Rates.
The different lenders provide different rates of interest. The personal loan rates are set based on internal policies and market scenarios. First-time borrowers must compare the different interest rates and choose the best option. Borrowers with high credit scores can negotiate personal loan rates and get a higher amount at a lower rate with flexible repayment tenure.
- Avoid Multiple Loans.
The major mistake that any borrower can make is to take multiple loans at the same time. Multiple loans may offer you huge funds but can have negative impacts. Multiple loans will make you look credit hungry in front of lenders, and the EMIs will increase your monthly expenses.
- Check the Loan Tenure.
The tenure of a loan is the time given to the borrower for repayment of the loan. This time is decided before the loan is finalized. Borrowers have the option to select the tenure of their choice. To keep track of the repayment schedule, one can use an EMI calculator, which helps to calculate the monthly installments.
- Look out for Additional Charges
The disbursement of the online personal loan can lead to many additional charges, such as processing fees and documentation fees. There can also be pre-payment charges if you pay your loan before it gets tenure. So, being a first loan borrower, you must read all the details carefully before signing any loan-related documents.
The loan can be considered a financial asset to fulfil personal, professional and business needs. The tips above may guide first-time applicants through a successful loan application process. A final tip for you as you prepare to apply for an online personal loan is that you do not miss the EMIs. Missed payments will decrease your credit score and, consequently, your chances of availing loan in the future.