Personal loans are among the viable financing options. Its features, like multiple-purpose financing, no end-use restriction, and quick disbursement, make it a preference for individuals looking for funding for financial emergencies.  

Do’s and Don’ts While Applying for a Personal Loan 

1. Check Eligibility First: Borrowers must check the personal loan eligibility parameters to understand if they are eligible to secure a personal loan with the lender.

2. Apply for a Suitable Loan amount: A personal loan amount can be as high as Rs 25 lakh with reputed financial institutions. However, you need to determine the right amount of money that is easily repayable without financial burden.

3. Avoid Long-term Repayment Tenure: A long-term personal loan tenure can reduce the loan EMI (Equated Monthly Instalments) with a lower interest rate and increased number of months to spread the principal amount. But, overall, it results in a high cost of borrowing. Therefore, consider a short-term loan and save on total interest costs. It can be between 12-60 months.

4. Choose a Lender with Digital Loan Processing Facility: For easy and quick loan processing, you can approach a lender leveraging technology and allowing customers to complete all formalities digitally, from making an application and documentation to loan disbursal.

5. Avoid multiple loan applications: Multiple loan applications can harm your credit score. With every hard inquiry by lenders, the credit score decreases. Therefore, avoid making a loan application with multiple lenders at the same time. Also, take a break before making another application if one loan or credit card application gets declined. 

Considering these crucial aspects, individuals can obtain a loan without any hassle and financial burden for repayment. Look for lending institutions offering affordable loans following a convenient digital process.