Personal loans are one of the most popular sources of quick money. One of the hassle free ways to meet your monetary requirements almost immediately would be – by making use of unsecured loans. Despite its increased demand, there are a number of people who are still walking away due to some misconceptions they’ve heard and haven’t bothered to confirm. The point is to stay informed of the real picture, so that you can make the right decision and not hesitate at the time of application.
Here are some of the myths about personal loans, demystified:
– Can personal loans be used if I already have an existing loan or loans?
The only thing that lenders look at is your ability to repay the loan you are about to take out. However, if you have too many loans or credit card bills, it doesn’t mean you can’t get a personal loan. There is a service called debt consolidation where you can combine your debt from various institutions into one personal loan. This will definitely give you better control over your debt load, as you will now be paying a single installment instead of multiple.
– Why are interest rates unreasonable?
It is a fact that the interest rates of loans that do not require a guarantor are slightly higher compared to conventional loans such as secured loans. The reason is that these are unsecured loans that do not require collateral or collateral, so it is natural for banks to make sure that your money will be repaid. If you’re interested in getting the best interest rate available, you’ll come across several seasonal deals that are definitely worth taking advantage of.
– Can I apply more than I require?
Applying for any type of loan beyond your ability to pay is generally not a good idea. You may come across various agencies that claim to give you the maximum loan amount (which is usually beyond your ability to repay) in order to enjoy so-called maximum benefits. Don’t be fooled by that because lenders never approve when you exceed your payment limit. Always remember, borrow only what you need so that a) you can save on unnecessary fees and b) you can easily take advantage of other loans when needed at a later stage.
– Can I apply for a personal loan in multiple institutions?
Although it is not against the rules to apply for a loan at multiple institutions, but if even a bank knows about your application at multiple institutions, it will only further delay your process of getting a loan immediately and increase your chances of rejection. . Therefore, it is safe to not apply to multiple institutions so that you have the best chance of getting your loan approved.
– Is my credit score the deciding factor for my loan approval?
Your credit score is one of the important factors in whether your loan is approved or rejected, however, it is not the ONLY factor that decides your application. Other factors, such as income, company category, and overall profile score, also play an equally important role.
There will be several other questions that come to your mind, so you need to approach the right people when it comes to your personal loan application.
