Personal Loan

Common Personal Loan Myths

Personal loans are one of the most popular quick money sources. One of the hassle-free ways to fulfill your monetary needs almost instantly would be to take advantage of unsecured loans. Despite the increasing demand, there are still a few who hesitate because of some misunderstanding they heard and didn’t bother to verify. The main thing is to be aware of the real picture, so that you do not hesitate when applying and make the right choice.

Here are some unsolved myths about personal loans:

– 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’re about to get. However, if you have a lot of credit or credit card bills, that doesn’t mean you can’t use personal credit. There is a facility called debt consolidation where you can consolidate your debt from various institutions into a single personal loan. This will definitely give you better control over your debt load because you will now be paying a single installment instead of multiple installments.

– Why are interest rates unreasonable?

It is a fact that the interest rates of loans that do not require guarantor are slightly higher than conventional loans such as secured loans. This is because there are unsecured loans that do not require collateral or collateral, it is natural for banks to get their money back. If you are eager to get the best interest rate available, you will come across a variety of seasonal offers that are definitely worth taking.

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– Can I apply more than I need?

It’s generally not a good idea to apply for any loan beyond your repayment capacity. You may encounter several institutions that claim to give you the maximum loan amount (often exceeding your repayment capacity) and you can enjoy the maximum benefits. Don’t be fooled by this because lenders will never approve when you exceed your repayment limit. Always remember, borrow only what you need to a) save on unnecessary installments and b) easily take advantage of other loans when you need them at a later stage.

– Can I apply for a personal loan to more than one institution?

Although it is not against the rules to apply for a loan to more than one institution, but if even a bank knows about your application at various institutions, this will only delay your loan process even more and increase your chances of being rejected. . Therefore, it is safe not to apply to more than one institution to have your best chance of getting your loan approved.

– Is my credit score the determining factor for my loan approval?

Your credit score is one of the important factors in getting your loan approved or rejected, but it’s not the ONLY deciding factor for your application. Other factors such as revenue, company category and overall profile score play an equally important role.

There will be a few more questions on your mind, so when it comes to your general purpose loan application, you need to approach the right people.

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