Personal loans may sometimes come to your help in times of financial need. You may apply for a personal loan to meet expenses related to varied purposes, such as wedding, education, travel, home renovation, medical emergency, or debt consolidation. However, your aim while taking a personal loan is to solve your financial troubles instead of overburdening yourself with debt. So, here are some golden rules that can make your personal loan management easier than ever.
Apply for Minimum Loan Amount Required
Technology and the internet have made loan taking process much faster and easier than before. Lenders like Clix Capital can generously offer personal loans of up to ₹ 25 lakhs. But that doesn’t mean you must take the maximum loan amount possible. After all, you have to pay it back along with the interest rate. So, assess your requirements first and apply for the minimum loan amount required.
Keep Loan Tenure as Short as Possible
As a borrower, you may try to choose a longer loan tenure, because the longer your tenure is, the lower amount of EMIs you will have to pay every month. However, the fact is that although the EMI amount may be reduced, you will end up paying much more interest amount over the loan term. Keeping loan tenure short may increase your EMI amount, but your total interest outgo will be reduced and you will get rid of your debt much sooner.
Use a Personal Loan EMI Calculator
A personal loan EMI calculator is a useful tool that you can use to know how much EMI amount you will have to pay if you take a particular loan amount for a specific period of time. With an estimate of the monthly EMIs you have to pay, you can select a loan term as per your repayment capacity. Calculate your EMIs and ensure that they do not consume more than 30-40% of your monthly income.
Check Your Credit Score
Most lenders ask for a credit score of at least 750, without which they do not accept your loan application. It is a 3-digit score between 300 and 900, which you receive based on your credit history and repayment habits. A low credit score indicates that you are not a responsible borrower and lenders may perceive you as a high-risk prospect.
Check your credit score before applying for a personal loan and improve it if it is less than 750. If you apply with a low credit score, you will have your loan application rejected. As a result, your credit score will be reduced further and it will become even more difficult for you to get loan approval in the future.
Setup Automatic EMI Repayments
While you are busy in your daily life or going through a financial crunch, it becomes easier to skip or delay EMI repayments. As a result, the amount keeps building up and you end up ruining your credit score and also paying charges and penalties unnecessarily. One best solution is to set up automatic EMI repayments from your bank account. By doing that, your EMI amount will be deducted from your bank account automatically every month and you don’t need to remember paying it. So, there’s no chance to miss or delay payments at any cost.
Planning to apply for a personal loan? Apply for a personal loan from Clix Capital and use the abovementioned golden tips to manage it like a pro. Get loan approval within 15 minutes*, take a loan amount of up to ₹ 25 lakhs, and repay in 12 to 48 months of the loan term.
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