Today, getting a personal loan is extensively easier. Banks have reformed their rules and process and make it customer friendly. Yes, in no time you will get a personal loan. There are many banks which offer different kind of loans; one such good bank is axis bank personal loans. Due to this factor people often ignore many other important things before availing such loans. Here are the top 5 things you need to understand before going for a personal loan.
Get complete information regarding penalty charges
People often are not very keen to know about the rules regarding penalty charges. However, they don’t release that due to the nature of the loan, there penalty charges are often very high. Thus, it’s extremely important that people should go through properly and understand what are the charges being levied in case someone is unable to pay the money.
Build a clear credit history
Are you aware of your credit score? Well, if not, then do consider this factor before applying for a personal loan. It’s an important factor which any bank highly consider before availing loans to their customers. They are not only considered with your income status, but also concerned with your past credit history. Hence, if you have any pending dues statements, then do clear them.
High interest rate
Personal loans carry a high rate of interest due to the nature of the loan. As the receiver of the money doesn’t need to keep any assert for security this increases the risk factor for the bank. Hence, your bank levies a very high rate of interest. The interest varies from 11.99% to 30% annually. The interest depends on your profile as well as your capacity of repayment. Bank offers close to 30 Lakhs of money for a period of 1 or 2 years. Based on your loan amount and the time period, your interest is calculated, i.e. EMI (equated monthly installment).
Calculate other costs as well!
While getting a personal loan from any bank you need to consider various other costs such as prepayment fees, processing charges, and late payment fees and so on. Each fee or charges vary and depends on your loan amount. Also, in case you decided to pay your loan early you need to pay additional charges i.e. you prepayment charge. Different banks levy different prepayment charges rate.
As the nature of the loan is unsecured hence you need to show proof of job continuity to the bank. For example, some banks require their customers to be employed in the company at least for a period of 2 years and should be continually working currently for a min. of 1 year. Moreover, your net salary should be at least Rs 15000 in metropolitan cities like Delhi, Mumbai etc. and Rs. 12000 in other parts of the country per month. Along with this, certain documents like your past 6 months bank statements and salary slip is needed. And other documents which includes like identity proof, address proof and current salary certificate.
These were the few important factors you need to consider before availing personal loans from any bank.