Author: SMFG India Credit

SMFG India Credit http://financenews.wordpress.com SMFG India Credit Co. Ltd. (Formerly Fullerton India Credit Co. Ltd.), is registered as an NBFC - Investment and Credit Company (NBFC-ICC) with the Reserve Bank of India, and is a member of SMBC Group. SMFG India Credit started its India operations in 2007, and is today a leading NBFC with a pan India presence. Working together with over 16,500 employees, we reach our market by connecting with around 3.2 million customers, be it in cities, towns or villages, right at their doorstep. We penetrate deep inside the market through more than 729 branches, covering 600 towns and approximately 65,000 villages.
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Planning to study abroad: Know the Financial Implications and Requirements

Pursuing education abroad is a dream for several students as well as their parents. Studying abroad is not just about acquiring a degree and securing a well paying job. It is also about getting opportunities to be taught by some of the best minds and networking with peers from different parts of the globe. Funding foreign education with one’s own resources may not always be possible and hence one may have to seek an education loan. However, it is important to understand the financial implication of such an education loan before taking the plunge. Both the students and family must consider the following before taking a final decision:

  1. Availability of scholarships:

Students and their parents should first enquire about the availability of scholarships or grants. Foreign universities offer a plethora of scholarships. Grants may even be provided by local trusts. Funds offered by such scholarships or grants can cover a substantial part of one’s expenses and thus parents and students can consider an education loan to cover the remaining portion. One can come across these scholarships by searching for ‘how to finance study abroad’ on search engines.

  1. Is their education loan tax deductible?

 The Income Tax Act provides for deduction of the loan paid on education loan interest as against income of the person. Such deduction however is restricted to certain institutions and it must be verified if such benefit is available through your institution.

  1. Student profile:

 The student profile would determine the number of fees being charged. Certain universities charge higher for foreign students as opposed to the local students. 

  1. Other expenses:

Apart from the above, various other expenses such as lodging, food as well as books must be considered for foreign education loans. However, one can manage these expenses by taking up a part time job. Nevertheless, it is best to account for these expenses as combined together they can result in a substantial amount. 

Strong student performance in the past and a reputed university might serve as the eligibility criteria for personal loans (https://www.fullertonindia.com/personal-loan-eligibility.aspx) apart from the CIBIL score. These factors must be considered as the question of how to finance study abroad arises.

Must Read: How Fullerton India’s Personal Loan can make your Festival Special?

Prepaying Personal Loans – Tips You Should Keep in Mind

A personal loan is the easiest type of loan you may avail to settle off existing debt, buy a property, purchase a motor vehicle, or for any other purpose. However, the personal loan is a liability, and you need to make a robust plan to pay off the dues in time; else, the lender might impose a fine. Thankfully, you may prepay the loan without waiting until the end of the term.

Here is a laydown of the do’s and dont’s you should consider before prepaying.

The Do’s

Create a Provision for Meeting Daily Expenses

Ensure that prepaying the loan does not put any additional burden on your monthly fixed expenses. Stay cautious if you already have a personal loan or mortgage loan, as not paying the dues on time may decrease your credit score.

Use a Personal Loan EMI Calculator

Before deciding to prepay the loan, use a personal loan EMI calculator to check if you can manage a discount from another lender. Sometimes, it is better to switch to a different lender who is offering a lower interest rate than to prepay the loan.

Check the Prepayment Charges

Lenders often charge a prepayment penalty, which can partially offset the benefits of paying off the dues early. Calculate how much you are saving in real terms by prepaying. Opt for prepayment only when you feel the long-term benefits far outweigh the short-term ones.

The Don’ts

Don’t Burden your Personal Savings Account

The worst mistake that you can make is prepaying by emptying your savings account. By doing so, you can make yourself vulnerable to unpredictable emergencies. If such a need ever arises, you might have to apply for a personal loan again.

Never Discontinue or Close Existing Investments

Sometimes, you might feel like surrendering your mutual fund units, selling your stocks, or pulling out money from retirement funds is the best option. But, by doing so, you can lose the opportunity to make handsome profits. If given time, mutual funds, stocks, or retirement funds can generate higher returns than you will pay as loan dues over time.

Conclusion

Before prepaying a loan, consider all its pros and cons. There is probably nothing better than prepaying a personal loan. However, prepaying should never seem like a burden.

Must Read: Small Personal Loans: Everything You Need to Know!

Personal Loan – Your Best Friend During an Emergency

An emergency may knock on your door when you are hardly prepared. Although you might have an emergency corpus to take care of such situations, considering the ever-rising cost of healthcare, that, might fall short. An emergency personal loan may be your best bet during such times.

An emergency loan is the best way to fund short-term financial emergencies without breaking your existing fixed deposits, emptying your savings account, or paying high premiums for medical insurance. Typically, the entire loan approval process happens online, and it takes no more than fifteen minutes to submit the documents required for a personal loan and complete the formalities. The money gets directly credited to your bank account before the end of the day.

How to Ensure an Emergency Personal Loan Approval

As an emergency personal loan is the most convenient loan during an emergency, to ensure its approval, you should keep the following points in mind.

1. A credit score of 700 and beyond can fetch you the best interest rates and loan terms.

2. It is better to apply for one emergency loan at a time. Too many loan applications can negatively impact your credit profile.

3. Try to keep a six-month gap between personal loan applications.

4. Keep an eye on your debt-to-income ratio. Ensure that your debt does not cross 50% of your monthly net income.

5. As personal loan interest rates are often lower than credit card rates, it is wise to keep your credit card bills in control.

6. Ensure that your credit profile has a healthy mix of unsecured and secured loans.

Conclusion

Emergency personal loan interest rates are more cost-effective than many other loans. Use a personal loan EMI calculator to check which loan term offers the maximum savings. Also, create a budget for paying the loan dues regularly, as non-payment can hit your credit profile hard.

Must Read: How Doctors Can Avail a Personal Loan from Fullerton India?

4 Ways In Which You Can Use A Business Loan To Grow Your Company

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Leverage in business can play an important role in the growth of the organization. Using debt judiciously can enable one’s business to scale up and grow rapidly. Whereas equity funding might be difficult to obtain, it is comparatively convenient to arrange for debt.

A business loan can help a business grow in the following manner:

  • Cost of debt is lower than equity:

The cost of obtaining debt is often lower than raising equity as one doesn’t need to dilute one’s holdings. Apart from that interest rate on a business loan is also tax-deductible. This not only provides cheap capital but also assists in a tax deduction.

  • Allows the business to upgrade technology:

A business loan in the form of a credit limit or overdraft facility can allow the promoter to pounce on opportunities without any hesitation. Such funds can be used to upgrade technology or buy new machinery.

  • Allows the business to keep in with demand through additional inventory:

In a similar manner to the up-gradation of technology, such funds can be used to purchase additional raw material or products in case of trading in times of demand. A business loan can allow the business to take advantage of such a situation. 

  • Business loans allow for the hiring of additional staff in need:

The availability of funds can allow the business to hire new staff if necessary. Temporary staff can be hired in a peak period without committing to a larger time frame. Often important employees are let go of or not hired due to the fund commitment however availability of funds discounts such problems.

Loans for business are generally required for expansion purposes and once business loan eligibility is verified, the company can use the loan to take the first step in their career of progress.

Additional Read: Planning To Get A Business Loan In Delhi? Know Everything Here!

FAQs

  1. Should I take a business loan for NBFCs?
  2. What is a good credit score to get a business loan?
  3. How does a business loan help business people?

Personal Loan Disbursement: A Brief Guide

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The onset of the digital era of banking along with increased usage of debt financing for personal purposes has led to an increase in usage of personal loans. Personal loans are being obtained for a wide variety of reasons from weddings and vacations to business and down payment for a house. Since personal loans do not require any collateral and need bare minimum documentation, such loans have become very popular.  (Checkout personal loan documents checklist)

Getting a Personal Loan

Personal loans in India can be obtained either offline or online but the online segment is gaining traction lately. Such loans have seen a processing time of less than a few hours later once the application is made. On verification of the application, KYC process, and checking the CIBIL score, a personal loan can be obtained instantly.

Loan Disbursement

The amount of disbursal may differ based on the type of loan as well as any fees being charged by the bank. While this does not change the loan amount, the total payment received by you may differ. Loan disbursements are also made through cheque or demand draft mode however that is slowly becoming obsolete.

Loan Repayment

Once the loan is disbursed, repayment for the same will be either through ECS or a standing instruction. EMI and interest payment for the same can be determined using a personal loan EMI calculator. Such a calculator can prepare the applicant for the total monthly repayments to be made. Any default on such repayment can affect the CIBIL score and the user must be extra careful regarding repayment of such loans.

Must Read: How to choose the best personal loan to match your needs?

Why Loan against Property is a Popular form of Financing in India?

LAPs are extremely easy to procure, considering the secure nature of the credit line. Moreover, as they aren’t particularly credit score dependent, loan rejection isn’t a restrictive issue, provided every property document is in place. 

In the subsequent sections, we shall take a closer look at the efficacy of LAPs when financial independence is concerned and why the same is the best option to get your hands on a sizable stash of cash.

  1. Decent LTV

Based on the property valuation trends in the bigger cities like Delhi, Mumbai, and Gurgaon, you are expected to get a decent LTV (Loan to Value ratio) or a bigger sanction on the property value for the loan against property, provided the lender has faith in your repayment capabilities. In most cases, you can even get an amount that is worth 60 percent of the existing property value.

  1. Competitive Interest Rates

A LAP needs to be repaid like any other loan and therefore it is advisable to consider getting a loan against property interest rate to be financially independent, both in the long and short run. 

  1. Flexible Repayment Tenure

If and when the LAP serves as a business loan, you can add a sense of flexibility to the repayment scheme by opting for a customized tenure. Then again, you need to be well-aware of your financial stead before proceeding with the tenure adjustment. 

In India, LAP is an extremely popular form of financing, provided you require sizable funds with minimal sanctioning dependencies.

Must Read: Never Refinance your Mortgage Loan Without Asking These Questions

MSME Loans – Application Process, Eligibility and Registration

Micro, Small and Medium enterprises are fundamental to the growth of India. They contribute almost 30% of India’s GDP, are responsible for 40% India’s exports and employ almost 11 crore people across the country. Recognizing the need and importance of MSME to the country, a slew of reforms and benefits have been announced by the government for MSME companies, including loans at a reduced rate.

For availing an MSME loan (https://www.fullertonindia.com/sme-msme-loan.aspx), the enterprise must be registered and hold Udyam registration or Aadhar Udhyog registration as it was known as previously. The registration can be obtained using the Aadhar of the promoter and the number is linked to other registration such as GST and Income Tax automatically.

Interest Rates and Process

Business loan interest rates for MSMEs are generally lower and provided at a much-subsidized rate in order to promote their growth and development. MSMEs can approach any financial institution in order to acquire such a loan and they may be granted the loan based on the eligibility criteria.

Documents Required

Whereas the finer details may vary, the following details are required to obtain an MSME loan:

  1. Udyam or Udhyog Aadhar Registration
  2. Balance Sheet audited by a Chartered Accountant
  3. Income Tax Return
  4. Bank Statements of the past six months
  5. Financial Institutions might require MSME to be in operation for a certain period

Apart from obtaining loans at a cheaper interest rate, MSMEs get various advantages in government tenders and other spheres of business activities as well. An MSME registration might just be the step you need to boost your business.

Must Read: Loans and Advances Comparison- Which is a Better Choice?

FAQS:

For what purpose is the MSME being used?

What are the eligibility criteria for MSME loan?

What is an Unsecured Loan: A Brief Guide

An unsecured loan is a personal loan that is provided by a financial institution without any collateral. Such loans are generally provided based on the income of the applicant as well as their CIBIL score. Since unsecured loans are not backed with any collateral, the interest rates of such loans are generally much higher as compared to loan against property and the same must be considered by the applicant before making any decision

Eligibility for unsecured loans:

Since collateral is not taken in unsecured loans, the CIBIL score of the applicant becomes one of the most important factors for financial institutions to verify the eligibility of the consumer. In order to ensure a proper CIBIL score, the applicant must ensure that they have made timely payments on all loans obtained to date. Apart from such payments, a large amount of debt may also result in a lower CIBIL score due to pressure of repayment. Along with a CIBIL score, an applicant must provide income proof and in certain circumstances, a co-signer may be asked to provide a guarantee on your behalf. After verification of all such documents, an applicant will become eligible for an unsecured loan in form of personal loan.

Documents required:

Any applicant must provide KYC documents in form of PAN and Aadhar to the issuing authority. Apart from KYC documents and CIBIL, personal loan documents required are as follows:

  1. Recent passport photographs of the applicant
  2. Loan application form duly filled
  3. Identity and Address proof along with Age proof
  4. Salary Slip and Form 16 in case of a salaried person
  5. Income Tax Returns
  6. Bank Statement for the past three or six months
  7. Cheque for the processing fee

Unsecured loans are a great tool used in case of emergency funds by an applicant however the user must be aware of the higher interest rates as any default could affect the CIBIL score of the user.

Must Read: 5‌ ‌Types‌ ‌of‌ ‌Personal‌ ‌Loans‌ ‌That‌ ‌you‌ ‌Can‌ consider‌

Personal Loans in the Future: Digital and Paperless

The last few years have witnessed the growth of digital transactions in India. Apart from government initiatives like Digital India (which aspires to build a cashless society) and demonetisation, the emergence of several public and private platforms have made digital transactions accessible to large swathes of Indian consumers. Indian consumers use UPI, e-wallets or USSD services for making digital transactions.

Apart from spending and receiving money, Indian consumers are going paperless for other money related activities too – such as making investments and availing loans.

Getting a Personal Loan is easier than ever before

Personal loans online is not merely a distant dream but it has already become a reality. Any person armed merely with identity proof and their PAN Card can apply for personal loans online and after due verification can get instant disbursement to their bank account. The hassles of filling up a form, waiting for the bank official to pick it up, and wait for weeks for processing is history now. Financial institutions can collect the credit history of the user through their PAN card and eligibility can easily be determined.

Online Verification Process and EMI Calculation

Financial institutions with the help of e-KYC and digital signatures have made instant loans without any physical intervention a reality. The consumers can verify different rates as well as EMI from different institutions online. Such a personal loan calculator online enables the consumer to make instant decisions and negates the need to visit the office of the institution.

The financial sector has been going through a flux however a seamless transition to digital transactions will ensure high traction for the sector. Digital and paperless loans allow time-saving, resource-saving and most importantly in the current times, allows the users to maintain adequate social distancing. Personal loans online have become a reality for all users through the shift to digital mode.

Must Read: How Personal Loan Balance Transfer Helps You To Reduce EMI?

How does Mortgage Loan Balance Transfer work?

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Regardless of the loan you take, balance transfer is one of the more rewarding approaches that can minimize your interest-centric liabilities. However, for balance transfer to work perfectly, you need to understand the process in its entirety and make adjustments to your existing loan structure, accordingly.

Why balance transfer is important?

The concept of balance transfer allows you to shift the existing loan to another lender that offers lower interest rates. Therefore, with balance transfer to rely on, you can easily lower your accruing interests by a significant margin. Moreover, balance transfer allows you to correct your indecision regarding a mortgage loan where you might have persisted with a lender, quoting higher interest rates.

Balance transfer allows you to shift the outstanding amount of the existing loan to a lender that allows you to enjoy the perks of a lower mortgage loan interest rate. This process ensures that your loan liability goes down significantly, which can then be converted into affordable easy monthly installments.

When to opt for Balance transfer?

Firstly, you should never opt for balance transfer if your loan tenure is about to end as the minor perks of saving some money are outweighed by the penalties and fines procured by the existing lender. In case you have started off with the loan repayment process and stumbled across a lender that offers lower rates, balance transfer during the initial phase is extremely lucrative and beneficial. 

Then again, you need to consider the additional charges, resubmission of documents, and balance transfer fees into account before making the final call.

Must Read: How to Secure a Mortgage Loan in 6 Easy Steps


FAQs:

How much of a mortgage loan can I qualify for?

What are the factors when getting a mortgage loan?

Is a loan against property the same as a mortgage loan?

Want To Avoid Any Risk In Personal Loan? Here Are 5 Ways To Do It

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Personal loans have become a go-to option for people who want to maintain their lifestyle or tackle any emergency without the hassle of documentation.

However, this comfort only leads them to trouble. If you don’t wish to end up like those people, you need to be very careful while applying for the loan and uploading the require documents for personal loan. Here are five ways to do it. 

5 Ways To Avoid Risk In Personal Loan:

#1 Do You Really Need It?

It wouldn’t be wrong to state that personal loan applying is very easy. That is why people opt for it even in minor inconveniences. Don’t make the same mistake. Before going for the loan, ask yourself if you really need the funds. In case the expenditure can be avoided or delayed, you shouldn’t get the loan. 

#2 Consider Repayment

Before opting for any kind of loan, your first step should be to consider its repayment. You have to check with your finances and your future financial plans to see whether or not the repayment fits your budget.  

#3 Look Into The Interest 

The borrowed amount isn’t the only thing you need to return. You also have to make payment for the associated interest rate on that amount. Consider this factor and only opt for the loan if the overall repayment amount falls under your repayment capabilities. 

#4 Don’t Miss The Fine Print

It is much more convenient to forget to check the fine print in the easy processing of personal loans. You should read each of the terms and conditions carefully before proceeding further because they may lead you into unnecessary trouble. 

#5 Check For Pre-Payment Options

All other calculations can be done using a personal loan calculator. But you also need to check for the pre-payment options if you are planning to repay the loan before the tenure ends. 

Keep these five factors in mind, and you won’t ever get in trouble with your personal loans. 

Additional Read: What Documents are required to avail Fullerton India Personal Loan?

Make Diwali the Festival of Home Decor With a Personal Loan

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Diwali is the best time to purchase gold, invest in new garments, buy gifts for your relatives, or acquire a new property.

Let’s make this Diwali a little different.

Give your home the makeover it deserves. Surprise your family, neighbours, friends, and relatives by renovating your home. After all, what is Diwali without a sparkle?

However, the cost of home renovation can often be higher than purchasing gold or buying gifts. Not to worry, as an instant personal loan can provide you with funds you require to give a dazzling new look to your house exteriors or interiors. An instant personal loan is a type of unsecured loan which does not need any collateral. Instant personal loan eligibility is the simplest among all loans. You can upload the require documents for personal loan online and get the funds in your account within a few hours.

The extended repayment tenure of an instant personal loan ensures that the EMIs never seem a burden. Additionally, by repaying the loan EMIs before the due date, you can increase your credit score, which will make you eligible to receive additional discounts in future loans or cards.

You can use the personal loan funds to paint your house or modernise your kitchen by installing a kitchen chimney or buying a dishwasher. You may also buy a washing machine, a room heater, an air-conditioner, or design your home with fancy lights. Alternatively, you can be a little creative and redesign your garden.

Before applying for an instant personal loan, you must compare the rates offered by various lenders. The best way to find out who is offering the best rates is by checking their personal loan eligibility and using a personal loan calculator.

Getting the best rates and redesigning your home can be easy. Make this Diwali the festival of home renovation by sprucing up the interiors and exteriors.

Must Read: A Checklist to Check before Paint your walls in this festive season

Want To Get A Travel Loan? Here Is What You Need To Do

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Do you wish to travel the world but don’t know how to apply for a travel loan? Follow this guide to learn the process of availing a personal loan for travel. 

Want To Get A Travel Loan? Here Is What You Need To Do

There were times when people used to save funds for years to travel abroad or go to some faraway places. However, conditions have changed now. In the current scenario, you can simply get a personal loan to fulfil your dream of traveling. You can apply for the travel loan here: 

https://www.fullertonindia.com/personal-loan-for-holiday.aspx

Simple steps you need to follow in order to avail of the loan are: 

Step 1: Check Eligibility

Not everyone can get a travel loan. You must fulfill some basic requirements to become eligible for this type of personal loan. This includes:

  • You need to be a citizen and a resident of India.  
  • You must have a good income source to repay the loan amount.
  • Your age must lie within limits provided by the lender. 
  • Your credit history has to be good enough to let the lender trust you. 

As per the guidelines given by your lender, you can check all these factors. 

Step 2: Application

Once you know that you are eligible for the loan, you will have to fill out a personal loan form. This step may be done online or offline, depending on your chosen lender. Fill each section carefully because even a little mistake can become a problem later. 

Step 3: Documentation

After filling the form, you will need to submit all the required documents. Your lender will provide you with a list of documents here. You may need to give the original or photocopy of each of them. 

Step 4: Get Funds

Your provided documents will get verified thoroughly to check your personal loan eligibility. Once the lender is sure that you are a genuine borrower, they will lend you the money within the least possible time. You will also have to provide your account details to the lender in which you want the loan. 

In these simple four steps, you will get enough funds to plan your dream holiday. So go on and apply now!

Must Read: Personal loan or a Credit card Which one Is Better for travelling?

How Do Lenders Can Decide Your Personal Loan Eligibility?

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Personal loans help meet urgent financial requirements as they are unsecured and do not require you to keep anything as collateral. These loans help meet individual and business expenses and are perfect for emergencies like medical emergencies, weddings, education, and more. 

What is Personal Loan Eligibility?

If you are looking to availing a personal loan, it is essential to meet the eligibility criteria required by the lenders and financial institutions. The requirements may depend on the lender and might vary, but the basic requirements usually remain the same. You can check your eligibility through the online personal loan eligibility calculator on the website of the lender you have chosen. You can fill in the details, and it will show you the loan amount for which you are eligible. 

Factors Deciding your Personal Loan Eligibility

  • Employment: 

Being one of the most important parameters that the lenders consider to decide your personal loan eligibility, employment plays a crucial role. You must be either salaried or self-employed and have a stable source of income. Lenders prefer to lend loans to people with a regular income as it also makes sure that they can repay the amount. 

  • Credit Score:

Another critical factor that determines your loan eligibility is your credit score, as it shows your creditworthiness. It also showcases your credit history and whether you have repaid the credit amount on time or have defaulted the payment at any time. Your credit score is affected by your outstanding debt, the total number of credit accounts, the credit history length, and more. All this comprises a credit report which is carefully analyzed before lending money. A credit score of 600-700 is considered to be good and viable for you to get a loan.

  • Work Experience:

Your total work experience also plays an essential role while applying for a personal loan online. The lenders check your work experience and prefer that you have worked for at least six months to a year to be eligible for the personal loan. If you have been steadily employed for a long period, it also shows your creditworthiness and makes it easier for the lender to decide. 

  • Age:

Your age plays a crucial part in determining your loan eligibility, and it is essential that you are a minimum of 23 years old and a maximum of 60 years. Most lenders consider this bar with little variations. 

  • Income:

The amount of salary you earn also decides the amount of loan you can get. It is also an essential factor to determine your personal loan eligibility and plays a part in determining if your application will get approved.

  • Documentation Proof:

It is also vital to have all the essential documents, including your age proof, identity proof, citizenship proof, KYC documents, salary slips, and bank statements. Without these documents, there are chances of you not being eligible for the loan, and it might be difficult for your application to approve. 

  • Employment Category:

The companies are classified into categories, and depending on the company’s risk profile; it might be more comfortable or challenging to get a loan. If you are working in a company with a low-risk profile, it might speed up the application approval, and if it is a high-risk company, it might get challenging to get a loan.

Therefore, the factors mentioned above play a crucial role and are considered by the lenders to decide your personal loan eligibility. You must make sure that you meet these requirements before applying for a loan to be eligible. If you fail to meet the criteria, it might get challenging to get approval for the loan. 

Must Read: 5 Tips to Acquire Attractive Deals on Your Personal Loan Interest Rate

Why Personal Loan is your Best Way out of a Financial Crisis?

Every financial crisis is best handled by a fast and sizable credit line. Amid a host of available choices, a personal loan is probably your best way out of a financial ditch. However, if you still aren’t sure about the efficacy of a personal loan, consider the following validations:

  • Easy to Avail

Instant personal loans are easy to procure, considering the unsecured nature of the same. Besides, if you can zero in on the perfect loan amount for your credit score, getting approved becomes easier than ever.

  • Easy Repayment Structure

Be it online or offline personal loans, lenders allow you to choose easy repayment structures that are in sync with your existing financial stead. As a borrower, you can use the personal loan interest calculator by feeding in the interest rates, tenure, and other details, to structure the sum payable, as per preferences.

  • Convenient Financing

If you are looking at online personal loans, you need to take the convenience of availability and procurement into account. Besides, if you are opting for digital NBFCs and lenders, loan applications, credit score checking, and disbursements are way faster as compared to traditional avenues.

  • Competitive Interest Rates

A personal loan allows you to choose between several credible lenders and eventually the most affordable interest rates. 

These characteristics qualify personal loans as the best crisis mitigating credit lines, regardless of the lender offering the same. However, you need to have a legible credit score, proper collection of documents, and decent financial standing for getting approved.

Must Read: 3 Ways To Get Loan for Self-Employed with No Income Proof

How to Stay Adrift of Personal Loan Scams?

Personal loan scams are predominant if you fail to connect with credible lenders and NBFCs. However, before enlisting strategies to scale beyond the scams, it is necessary to analyze the types of fraudulency beforehand.

Loan Scams to Counter

  • Advance pay

Fake lenders ask for upfront processing fees and approval charges, especially from individuals who are finding it hard to get an online loan application approved due to the lack of personal loan eligibility criteria (https://www.fullertonindia.com/personal-loan-eligibility.aspx).

  • Phishing

Cyber attackers lure you into loan approval possibilities and get hold of your personal details in the process. Eventually, they open fake credit accounts, and you end up getting notifications for loan repayments, even without procuring a single dime.

In addition to these, fraudulent lenders also initiate unsolicited scams or offer guaranteed approval offers to siphon off an unwitting borrower.

How to save yourself?

  1. Keep a close eye on credit reports

You are the best judge of your loan approval eligibility. Therefore, if a lender assures that your poor credit score wouldn’t matter and shall not be taken into consideration, you must stay away from the same.

  1. Stay away from Unsecured Addresses

If an email or message aims at redirecting you to a particular address sans ‘https’ tag, it might be a phishing attempt to leverage information.

  1. Only Connect with Credible NBFCs

Consider NBFCs that boast of decent word-of-mouth credibility and offer competitive personal loan interest rates. Any lender who promises unbelievably low rates are best to be ignored.

Personal loan scams have picked up pace in the post-covid19 era amid the job-centric challenges. A desperate borrower, therefore, needs to be discrete and smart to avoid being duped.

Must Read: Everything You Need To Know About Small Personal Loan

Why Should you Rely on Online Personal Loans?

In case you are tired of chasing financial institutions and representatives for a quick personal loan, try out the digital sources, at least once. A majority of online creditors offer hassle-free loan procurement services with a reliance on speed, competitive rates, and minimal downtime issues.

Therefore, if you have made up your mind about getting an instant personal loan online, consider sifting through some of their best characteristics:

  • Competitive Interest Rates

With a host of online lenders to evaluate and connect with, you can always look for the most competitive interest rates based on your personal loan eligibility.

  • Curated Offers

A majority of digital lenders keep a close eye on your search patterns, and once you feed in the necessary details for them to evaluate the credit profile and loan eligibility, they end up curating pre-approved credit lines for speeding up the procurement.

  • Paperless Process

Credible online lenders ensure that every process, starting from application to disbursement, is initiated over the concerned application or the relevant online platform. This feature saves time and is in line with your financial emergencies. 

  • No Collateral

As is the case with traditional personal loans, digital credit lines are completely unsecured and do not require any sort of collateral to approve the application.

Besides, these digital loans allow you to structure the repayment based on tenure preferences, thereby putting you in control of your finances. Not just that, almost every reliable online lender refrains from charging the hefty processing fee, mostly associated with traditional creditors.

Must Read: 6 Common Credit Score Myths You Should Stop Believing

Here Is Everything You Need To Know About LAP Eligibility

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Getting a loan against property isn’t difficult, provided you fulfill each of the diverse eligibility criteria. However, you need to understand that the factors determining eligibility aren’t complicated for a LAP courtesy of the secured nature of the same.

In the subsequent sections, we shall take a closer look at the diverse loan against property eligibility factors, thereby helping you apply and get approved, sans hassles:

  1. The first factor is to establish ownership of the property which gives you the right to put up the same for a mortgage. As a matter of fact, you cannot procure LAP for rented establishments.

  2. There should be any discrepancy or dispute related to the property as proposed by the sales deed.

  3.  Clear and airtight documentation becomes all the more important for commercial establishments.

  4. Despite this being a mortgage loan, you should have a steady source of income to qualify for loan approval. This criterion concerns your repayment capability, depending on the tenure of the concerned credit line.

  5. A good CIBIL score is also necessary to establish loan eligibility. In case you want to procure a credit line, consider pushing your CIBIL score to at least 750 for improving your chances of getting approved.

In addition to these eligibility factors concerning property loan, you must also ensure minimum to zero liabilities for being eligible for an extended line of LAP credit. 

However, it is necessary to check with the concerned lender for additional eligibility metrics, if any. 

Must Read: All You Need to Know About loan against property in India

How The Approved Personal Loan Amount Is Related To Your Salary?

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Regardless of the personal loan amount you apply for, the lender only approves for the sum that is in sync with your salary. NBFCs and other financial institutions believe that it might be hard for a borrower to repay the amount as monthly EMIs if the figure closes in on the overall income. For More Details Visit here: https://www.fullertonindia.com/personal-loan.aspx

Therefore, it is important to understand that the salary-related aspect and other factors can impact your eligibility if you plan to apply online for a personal loan.

  • Total Income

Lenders evaluate your primary and secondary income before approving a certain sum. However, to increase the chances of approval, it is advisable to evaluate eligibility and apply for a lesser figure.

  • Professional Stability

A higher income is of no use if you have an erratic professional standing. Therefore, job stability is also a factor that lenders take into consideration. The best way to depict the same is by showcasing the appointment letter and minimizing job changes.

  • Debt-to-Income Factor

Loans might get rejected if you have multiple liabilities to take care of. Creditors believe that a higher ‘debt-to-income’ ratio renders the credit profile riskier than usual.

  • CIBIL Score

If each of the mentioned aspects is in line within permissible limits, it finally comes down to your CIBIL score. Despite higher income and perfect personal loan documents, lenders keep a close eye on your credit profile when it comes to approving on rejecting loan applications. 

Getting approval for a particular loan amount depends on adherence to the mentioned aspects, with your salary having a massive bearing on the process.

Additional Read: How Technology Has Changed the Way we applying for personal loan

Things To Consider Before Prepaying A Personal Loan

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If you are considering an option to pay off the personal loan before the repayment tenure, there are quite a few things that you need to consider. While the feeling of financial stability upon prepayment might be tempting enough to consider, never proceed with the same unless the following aspects are taken care of:

  • Type of Personal Loan

If you check personal loan eligibility and eligible to apply for a loan after, the thought of prepayment should focus on the interest rates, penalties on overdue payments, and foreclosure charges, if any. For instance, it is always advisable to pay off a revolving loan like a credit card to ensure debt riddance, as quickly as possible.

  • Prepayment Caveats

If your lender is known to levy heft foreclosure charges, it isn’t advisable to prepay the loan early, and that too if you are nearing the end of the tenure. However, if you have taken a long-term loan and prepayment with foreclosing penalties is more financially viable than the accumulating interests, consider paying off the loan at the earliest.

  • Payment Methods

Now that you have made up your mind about paying early consider the best method to go about the process. In most cases, individuals consider debt consolidation where they get rid of the highest interest loan with a more affordable credit line. 

However, before you can even consider an early payment, it is necessary to accumulate the documents required for a personal loan to get a better clarity into the process. 

Regardless of the approach, prepaying strategically can also improve your credit score, in the long run. 

Must Read: Re-Applying For A Personal Loan? Here are 5 Things To Consider

Why Loan against Property is the Best Financial Decision during Emergencies?

Mortgage loans are extremely resourceful entities, provided you require quick financial support without exorbitant interest rates. Amid the diverse set of mortgage loans, a LAP is probably the most rewarding option to rely on, based on the usable amount, speed of approval, and competitive interest rates.

Here are some of the reasons why loan against property (https://www.fullertonindia.com/loan-against-property.aspx) is a prudent choice for funding businesses or attending to emergencies:

  • Sizable valuation

LAPs allow you to get a decent line of credit as credible lenders offer a true assessment of the concerned establishment. While the business and personal loans have funding limitations, you can procure a sizable amount as LAP, amounting to almost 3.5cr for self-employed individuals.

  • Flexible Tenure

LAPs, if and when offered by credible lenders, allow you to be flexible with the tenure. Most importantly, you can use the same as a long-tenure mortgage loan provided you are willing to repay the same, slowly.

  • Supports a wide range of properties

If you have made up your mind regarding a LAP, you can use a wide range of establishments for procuring a decent line of credit. Be it a commercial or a residential establishment, loans against properties are compatible with diverse assets. 

  • Affordable

LAPs are extremely affordable considered the secured nature of the same. This means that the loan against property interest rate is often lower than a standard personal or business loan. Moreover, this attribute ensures that you can extend the tenure without having to worry about the accruing interest. 

These features qualify LAP as the best form of financial support, especially during emergencies. 

Must Read: 5 Types Of Mortgage Loans: Which One Is Best For You?

Learn the Differences Between Fixed and Variable Rate Business Loans

If you want to apply for any form of a business-specific credit line, you need to understand the basics of chargeable interest rates. As a matter of fact, lenders usually levy either fixed or variable interest rates on the business loans (https://www.fullertonindia.com/business-loan-interest-rates.aspx), which eventually determines the cumulative sum that is to be paid at the end of the tenure.

In the subsequent sections, we shall take a closer look at the primary differences between fixed and variable rates associated with a business loan:

  1. Uniformity

Fixed business loans are the ones where a single rate of interest is used to calculate the interest payable during the entire term tenure. However, according to the name, variable rates depend on the Swap Rate, CDR, or any other index while changing multiple times throughout the loan tenure. 

  1. Financial Stability

Variable interest rates are better if financial stability at the onset is your primary concern. In case you choose business loans with floating rates from credible lenders, the initial rates are way lower than the market staple. Although the rates go up after a certain point of time, the initial support allows you to manage startup finances, better.

  1. Minimal Worries

If your venture is based on a steady model, a fixed business loan interest rate is expected to serve you better. Moreover, you need not take the changing market conditions into account as the interest rate remains the same throughout the tenure. 

Both variable and fixed business loans have their share of benefits and advantages, based on the existing financial stead and upcoming growth prospects. 

Additional Read: Follow these Easy Steps to Get A MSME Loan

How Is Fintechs Making It Easier For Borrower To Procure Loans?

As a borrower, it is advisable to look for loans that offer a lot more than just a decent stash of money. This is why it is advisable to connect with budding Fintechs and NBFCs for getting exceptional deals on personal loans in addition to a host of other rewarding perks:

  • Relaxed Terms of Eligibility

Fintechs realize that every borrower might not be able to fulfill the stringent personal loan eligibility criteria. Therefore, relaxed options, including approval for lower credit scores, lesser reliance on salary slips, and other optional documents, are offered.

  • Quick Approvals

New age Fintechs are known to support the quickest loan approvals. Moreover, a majority of these financial services can be procured over smartphone applications and, therefore, make way for even quicker loan approvals.

  • Customized Limit

A Fintech firm is quick to gauge your credit score, existing income, and other specifics for customizing the instant personal loan limit, as per your eligibility. This aspect or feature minimized downtime worries and subsequent chances of rejection. 

  • Soft Inquiries

Certain NBFCs gauge loan applications with a discretionary point-of-view. Therefore, if the credit score isn’t good enough for a loan, accommodating NBFCs and lenders only send a soft inquiry to avoid any major negative impact on the existing credit score. Moreover, they even allow you to apply after a few months by reassessing your eligibility accordingly.

Modern-day lenders offer these features to prospective borrowers for strengthening their short-term financial stead, sans hassles. 

Additional Read: Here’s How Personal Loans Can Help You to Save Money

Best Strategies for Make the Most of your Two-Wheeler Purchase

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For starters, it is advisable to consider a credit line for purchasing a new two-wheeler for keeping cash reserves in hand for emergencies. Now that you have made up your mind about getting a loan for your new vehicle, you can follow the mentioned strategies for making the most of the purchase:

  • Choose Wisely

A two wheeler loan is offered by a host of lenders and it is necessary to compare and choose well for getting a good deal on the credit line. However, the comparisons should be made based on the interest rates, ease of approval, overhead charges, and percentage of financial support.(checkout interest rate here)

  • Consider Used Vehicles, as well

If you want to make the most of your purchase, you should have an open mind towards used two-wheelers. While the new vehicles are tempting, you should never let go of a minimally used bike or any other vehicle, provided you get a decent price cut and financial support on the same.

  • Fix a Budget

A good way to make the purchase more productive is by predefining the budget and searching options in the concerned ballpark. Moreover, once you have a budget to work with, it becomes easier to calculate the down payment for a bike loan and use the EMI calculator to get more clarity on the EMIs and payment restructuring.

Besides, you also need to account for the additional monthly expenses concerning fuel, maintenance, and other overheads for setting a bike purchasing budget. Lastly, if you really want to make the purchase even more rewarding, try to maintain a good credit profile. 

Additional Read: What is Two-Wheeler Loan & Everything you need to Know

How to Get the Best Deals on your Mortgage Loans?

Mortgage Loan (LAP)

Mortgage loans are the ones that allow you to get a sizable credit line for collateral. However, every loan isn’t the same as you need to keep an open mind for getting the best deals in the existing lending space.

In the subsequent sections, we shall take a look at the best possible strategies for helping you save money on a mortgage loan. Here is a list:

Check These to Get the Best Deals on your Mortgage Loans:

  • Compare Deals and Offers

Comparing different mortgage loans is the best possible way to get a good deal. You need to compare different lenders and must go with the one offering the best rates, lowest processing fees, and minimal overheads.

  • Best Interest Rates

It is important to choose well and eventually go with the best mortgage interest rates, to save some money on the payments. A competitive interest rate ensures that you need not pay a hefty cumulative sum by the end of the tenure.

  • Seamless Restructuring

A good lender is the one that offers flexible repayment options, especially when loan restructuring is concerned. For instance, if you are planning to get a car loan, you can choose the tenure as per your existing financial standing. Every lender offers a mortgage loan EMI calculator to make repayment structuring easier for the borrowers. 

In addition to these, it is necessary to maintain a healthy CIBIL score to qualify for better and low-interest loans. Therefore, if you want to save money on mortgage payments, it is crucial to fix your credit history, beforehand.

Must Read: 6 Steps of the Mortgage Loan Process Explained

Here Is Everything You Need To Know About Short Term Personal Loans

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Getting hold of a short-term credit line immediately puts you in an advantageous financial position.

However, before connecting with a credible NBFC for borrowing a short term loan, it is necessary to take quite a few aspects into accounts:

  • Types of Short term loans

A short term loan can be tagged based on the nature of procurement. To start with, you can opt for the payday credit line for attending to emergencies. Besides, you can also access the same as a specific credit line, cash advance, online loan, and invoice financing.

  • Usage

Most NBFCs and other lenders allow you to use the personal loan as per preferences. Regardless of the usage, every short tenure loan aims at covering for some sort of financial emergency, including untoward medical expenses, unannounced cash crunch, and whatnot.

  • Seamless Accessibility

When it comes to procuring short term loans, accessibility is never an issue courtesy of minimal documentation and attainable eligibility terms.

  • Easy repayment options

Structuring short term loans is possible as per your existing financial stead. Moreover, NBFCs offer competitive personal loan rates and ensure that you can adjust the repayments as per preferences. 

  • Quick Disbursements

A majority of Non-Banking Financial Corporations are best known for the quickest possible loan disbursements. Moreover, most lenders are now accessible over apps where the loans are processed and credited almost instantaneously, provided you fulfill the eligibility criteria. 

In addition to the mentioned aspects, short term loans are also collateral-free and do not require long-term financial commitments.

Must Read: How to choose a best lender for Short Term personal Loan?

Important Aspects Borrowers need to keep in Mind Before Applying for a Loan Online

Acquiring a fresh line of credit from an online lender can get tricky at times. While offline avenues allow you to check the documents in person, it is necessary to be absolutely sure about the loan-centric requirements before going online. 

In the subsequent sections, we shall look at the aspects that you need to consider before opting for an online personal loan, auto loan, or any other form of financial support. 

  1. Interest Rates

It is necessary to compare different NBFCs in terms of interest rates before taking the call. Although the interest rates associated with personal loans are higher than education and mortgage loans, you might get a better deal if you are willing to compare the offerings via extensive researches.

  1. Speed of Approval

This aspect varies with the lender, and therefore, you must keep a close eye on the word-of-mouth and online reviews. As a matter of fact, NBFCs take lesser time while approving loans against property, home loans, and other mortgage loans owing to the secured nature of the same. However, unsecured credit lines like personal loans attract extensive background checks.

However, regardless of loan, online processes are expected to be way faster than conventional lending. 

  1. Ease of Documentation

Borrowers need to understand that online applications are synonymous with seamless documentation. Be it personal loan documents or KYC papers, the process of uploading details online is easier than putting forth offline applications.

These three aspects need to be determined and used as comparative metrics for evaluating the preferred NBFC for loan procurement. 

Must Read: Online Vs Offline Personal Loan- Which One to Choose?

Business Loans Or Overdraft: Pros And Cons

If you plan to expand your current business or start a new business, then taking a business loan or overdraft might have crossed your mind. Both of the financing products can be used to fulfill your financial requirements. 

 So, keep reading this article to know about the advantages and drawbacks of both the credit facility to help you find the right financing product for your business.

Business Loans

  • Pros
  1. You can easily borrow a massive amount for a long duration.
  2. Longer tenure leads to flexible and affordable monthly EMIs. So, there won’t be any stress on your monthly budget. 
  3. The eligibility criteria are easy-to-meet for business loans.
  4. You can quickly get competitive business loan interest rates.
  5. Business loans offer a fixed rate of interest. Therefore you know how much you need to repay.
  6. No tedious documents are required for a business loan. So, the entire application process is hassle-free.
  7. It can be availed by various entities, including individuals, women entrepreneurs, manufacturers, NGOs, traders, private and public limited companies.
  • Cons
  1. Generally, business loans are unsecured loans, but in some cases, it may require collateral.

Overdraft

  • Pros
  1. The borrower can freely decide the amount to be repaid each month.
  2. The borrower can speak to the lender about a tailored overdraft agreement and can quickly close the overdraft at any time.
  3. The application process is flexible.
  • Cons
  1. The interest rate is relatively high as compared to business loans.
  2. The current customer can only avail it from the financing institution. 
  3. Various additional fees such as application fees, monthly overdraft fees, and late payment fees are applicable.
  4. The financial institution can even cancel the overdraft without any notice. 

Conclusion: A business loan is a viable option to meet long-term business requirements. Both of the financing products have their advantages and disadvantages. So, choose the credit facility that meets all your needs. 

Must Read: 5 Ways to Get a Small Business Loan For a New Business / Startup

Why to Use Bike loan Calculator?

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A two-wheeler helps bypass the traffic and make the commute faster for many people, but not everyone in the country can afford to purchase a two-wheeler without a bike loan.

Buying a new bike involves multiple steps starting with deciding on a budget. The online Bike Loan Calculator tool gives a detailed breakup of the total payable amount and loan-payoff period based on the loan amount and other requisite information to calculate EMI for a bike loan. The bike loan Calculator tool is one of the easiest ways to calculate bike loan EMIs.

Main benefits of using a bike loan calculator:

  • Helps in estimating the EMI amount:

The primary use of this tool is to know the precise amount you are to pay every month. Getting the estimate beforehand helps in setting your monthly budget.

  • Helps in comparing loan offers:

If you are offered loans from two or more lenders for the purchase, using this tool to compare the costs involved will help you choose the most suitable loan offer.

  • Helps in negotiating terms:

Once you know the basics of the financials involved, it helps negotiate terms of the bike loan such as interest rate, processing fee, etc. after establishing the ground.

  • Provides a break up of costs:

This tool offers useful information such as the breakup of the loan charges like interest and processing fees.

Conclusion

Getting a bike loan is exciting. To understand the product and its monetary component helps you in deciding the right loan offers.

Must Read : Bike Loan vs Bike on Lease: Which is the Right Choice?

Multiple Personal Loans: Advantages And Disadvantages

A personal loan is a one-stop solution to all your expenses, whether they are costs related to medical emergencies, wedding expenses, house renovation, or higher education. 

The personal loan eligibility criteria can be met easily with minimal documentation with no restriction on availing multiple personal loans. 

So, before planning to avail multiple personal loans, let us have a look at the advantages and the disadvantages-

Advantages of Multiple Personal Loans-

  1. Improves Your Credit Score

If you are to repay the loans within the repayment periods, multiple personal loans can be a smart way to enhance your credit score. 

  1. Swift Response

Multiple personal loans are the best option in situations where you need to take care of multiple expenses, and you are out of finance to cover them. 

  1. Flexibility

Higher the credit scores, higher are the benefits of multiple funding sources that can help the borrower in meeting the financial requirements effortlessly.

  1. Security

If you are into a business that needs continuous funding, taking up multiple personal loans can be easily used to secure the finances of your business.

Disadvantages of Multiple Personal Loans

  1. To pay for all the monthly instalments, you will need a steady income that can accommodate all your liabilities.
  2. You need to repay the loan without any failure, or you might end up with a bad credit history.
  3. To repay multiple loans, you might need to cut down on luxury or even necessary expenses.

Conclusion 

Now that you have all the information about multiple personal loans, you can go ahead and check your eligibility using a personal loan calculator and apply for it. 

Must Read: Get a Personal Loan for Women to Boost Your Financial Profile