Personal loan comparison is one of the most essential steps when applying for personal finance. It ensures you get the best deal out there. However, for many borrowers, especially those who are taking a personal loan for the first, comparing options can seem like a troublesome task. Fortunately, we will make it easier by telling you the most important things to bear in mind during the comparison process.
1. Compare the amounts on offer.
Among the first things you should do is compare the loan amounts on offer. Not all lenders will offer the same upper and lower limits on their personal loans.
Tenures are very important. Lenders that offer longer tenures make it easier for you to repay your loan. However, some lenders will offer way shorter tenures than others. This will result in strenuous repayments synonymous with cash crunches and financial woes.
3. Processing fees.
This is the cost to apply for personal loans. It is a non-refundable amount that you need to pay the lender when you apply for your loan. This amount is usually 1 or 2 percent of the loan you are applying for. Lenders use it to cover the cost of evaluating your application. Now the catch about this cost is that it is non-refundable. This means you will not get it back even if your loan is rejected!
Some lenders run promotional offers wherein they waive-off the processing fees for a few weeks during the year. Some lenders have lower processing fees than others whereas some offer 0 processing fees if you have a strong financial profile or if you have borrowed from them before.
Besides the processing fees, all personal loans will have a long list of charges. This list varies in length, as do the charges in weight, from one lender to the next. Therefore it is important to compare the charges applicable with every lender. Usually, these charges include things like prepayment charges, late payment penalties, document handling charges, etc.
5. Interest rates.
Some borrowers usually start their personal loan comparison process by crosschecking the interest rates applicable. Though this might help you find the cheapest loan, it might not help you find the most quality finance solutions. Therefore, look for loans that check all of the above criteria and then see which one has the lowest rates. This helps you find good loans that are also affordable.
6. Quotations are helpful.
Yes, quotations can help the personal loan comparison process significantly. Knowing just what the lenders have to offer in terms of tenures, loan amounts, rates, processing fees, etc. will help you make a better comparison.
7. Use an aggregator site.
Finding all of the above information and getting instant quotes is a cake walk with personal loan aggregator sites. They list the top loans in India and also provide their interest rates, loan amounts, tenures, and processing fees so you can quickly compare. They will also provide you with instant quotes from the top lenders in a jiffy.
Hope this has been helpful, good luck and happy borrowing!