As per a recent report, the personal loan segment in India registered a growth of 11.2% in July 2021 that is 220 higher basis points than July 2020.
The reasons can be attributed to factors like current personal loan interest rates, abbreviated processing time, simple documentation and likes. Additionally, individuals can also avail a personal loan to address financial requirements, starting from paying expensive medical bills to funding leisure travel.
However, individuals need to consider a few factors to bag the best offers available on this credit before applying.
Things to consider for best offers on personal loans in 2021
Following are some crucial factors that individuals need to consider to get optimal offers while borrowing:
- Credit score
The most important parameter that determines the personal loan eligibility of a borrower is CIBIL score. Ideally, a credit score of 750 and above is deemed ideal for a personal loan.
This score impacts the loan amount to be sanctioned, i.e. loan’s approval. Besides, a higher score also helps borrowers get one of the best current personal loan interest rates. Thus, individuals should find ways to improve this score to qualify for the best offers. To do so, they first need to clear the existing debts, pay bills on time and follow such measures.
- Employment status
Besides credit score, lenders also assess applicants’ monthly income and employment type before approving a personal loan. For instance, salaried individuals with a fixed monthly income will likely secure the best deals on this loan.
On the other hand, individuals with a low salary can also get the best of current personal loan interest rates. However, in that case, they can consider applying for a small-ticket personal loan. It will also help them repay the debt faster. They can also use a personal loan EMI calculator online to compute their monthly payable.
Financial experts suggest keeping FOIR or debt-to-income ratio below 50% to ensure the best of current personal loan interest rates. It ascertains the lender of the timely repayment of the loan.
Hence, a low FOIR allows borrowers to enjoy the best offers on this credit. For instance, an individual earns Rs.60,000 monthly, and FOIR is 40%. Therefore, that person can service an EMI of up to Rs.24,000. However, individuals need to remember that while calculating FOIR, they need to also include the EMI of the loan yet to be sanctioned.
However, individuals should also keep some funds aside for emergency purposes. Once they know their monthly instalments, it will be easier for them to plan their personal loan EMI repayment better. They can also use an interest rate calculator and adjust the tenor and loan amount accordingly for more convenience.
- Pre-approved offers
Besides affordable current personal loan interest rates, existing customers can also avail pre-approved offers available with financial institutions like Bajaj Finserv.
This NBFC also provides pre-approved offers that simplify and expedite loan processing. Besides personal loans, such offers are also available on a host of financial products like business loans, credit cards and many more. Enter your name and contact number to check your pre-approved offers online.
- Choose a lender carefully
The personal loan interest rates and other loan terms vary with lenders. Hence, it is necessary for borrowers to choose the right personal loan lender to secure the best deals. In this regard, individuals can contact a lender they have availed a loan from. The existing relationship with lenders ensures the best deals on personal loans or any credit in that matter.
Moreover, if borrowers have an impressive repayment history, they can negotiate better interest rates and other benefits like reduced processing fees, nominal additional charges and likes.
These are some aspects that individuals need to consider to make the most of current personal loan interest rates and other offers. However, before proceeding further, they should decide the loan amount carefully to ensure a smooth repayment.