Wednesday 26 November 2014

Things to consider before signing on the “Dotted Line” While Loan Taking




Getting a loan is easier said, than done. While approaching for a loan it may seem to you that all banks are eager to lend, but getting a loan sanctioned is actually a tedious task. Also, in order to avoid any nasty surprises, it is crucial to be acquainted with the basic knowledge about the home loans and how they work. The listings below outline some important things which are must to know -before signing on the dotted line of the loan taking document.

The Eligibility Criteria: Along with your financial strength the factor that affects your eligibility for loan taking is your profile. Plus, the latter also effects on the amount that the bank agrees to lend . For instance, for individuals with a stable source of income get a personal loan,Installment Loans or any other loan easily relatively in comparison to a person with erratic earnings.  

Your Loan Type: Before taking any decisions, it’s really very important to know about the loan types. The loan
policies, clauses, benefits and interest rates vary from loan to loan and from bank to bank. So before singing on any of the documents make sure you are well versed with the niches of the loan type you decide to hold onto.
Negotiate the Interest Rate: Whatever option you fix for the loan taking, don’t forget to negotiate. Though the lender/bank may have an upper-hand, but still you can haggle- and you may also get additional benefit if you are an old customer posing with a long term relationship with the bank. Keep a clean record of your credit history, as you may use for the negotiation of the loan amount and the interest rate.

Besides the above the most important thing is to read the documents carefully before signing. A loan agreement is often incomprehensible, thus there can be a few hidden “devils” in the details.So you need to be careful about the penalties and add-on charges. It is not merely the interest rates that are required to be paid by you. The additional charges such as processing fees or service and administrative charges that is included in the add-ons. 

You can take a personal loan for any reason or for any financial requirement. The reason will not be asked by the lender to the applicant. But before you think to avail any such personal  loan make sure that there is no other source left with you where from you can arrange the money. We are saying this as personal loan or any short term loan comes expensive.