It is very important to know all the information related to instant loans before you take them so that you don’t fall into trouble. By gaining sufficient knowledge on this topic, you can highly increase the chances of your loan being approved. If you are the one who is thinking of taking a loan, then this article is perfect for you, as it contains all the required information. So, do not forget to take a peek into how you can apply for an instant loan.
Maintain A Good Credit History
A credit score is representative of your creditworthiness, which is based on your past credit repayment. For getting a loan you should have a minimum CIBIL score of 750. A lower credit score simply indicates poor debt. So, it may result in your loan application being rejected or an extremely high rate of interest on your loan amount.
You can easily maintain a good credit score just by paying your dues on time. Another potential and easy way of maintaining credit history is by eliminating all the credit cards. Also, you can ensure that you only use a single credit card and maintain a good credit history. You should never exceed 30% of your credit utilisation.
Compare The Rate Of Interest
Before you apply for an instant loan on any app, make sure that you compare the rates that are offered by many financial institutes such as Bankbazaar, Paisabazaar and more. This is going to help you select a personal loan scheme at the lowest rate of interest, and a type of EMI that suits your situation.
Assess All Hidden Cost
There are a lot of hidden costs that are attached to the instant loan such as prepayment fees, processing fees, late payment fees and more. That is why, before you take a loan make sure that you take a clear estimate of all the hidden charges. This is going to help you understand your finances better and it will also help you in evaluating whether the loan is affordable or not.
Evaluate Your Ability To Repay The Loan
Before you take a loan, make sure that you are prepared for its repayment. You can calculate it easily by keeping track of your expenses and income. Keep in mind that you do not take a loan of more than 60% of your salary. You should clear out all the outstanding loans to get rid of financial confusion in the long run.
Avoid Falling For Gimmicky Offers
There are a lot of lenders who offer low interest and outstanding offers just to attract people. However, when you go through all the processes, you find that these loans turn out to be very expensive.
The Bottom Line
We have almost mentioned all the important factors that you should keep in mind before you apply for an instant loan. Make sure that you apply for a loan from a registered company so that you don’t get trapped later on. If you are taking a loan try and repay it on time, to avoid unnecessary chaos.