5 Common Mistakes to Avoid While Taking a Personal Loan in Delhi

5 Common Mistakes to Avoid While Taking a Personal Loan in Delhi

Delhi is the National Capital Territory of India, the second-most populated city of the nation, housing more than 11 million people. It also acts as the largest commercial centre in northern India. Delhi houses several agencies of private and public sector industry including IT, telecom, banking, media, and tourism.

Delhi also houses a rich ethnicity. A significant number of people come from different states across the country to earn their living. This has made the territory a bustling economic hub, with a growing lending industry offering personal loans in Delhi to cater to unique requirements of numerous borrowers.

Why Avail a Personal Loan?

There are several reasons why you might want to avail this type of short-term, unsecured financing option. A personal loan does not have any end-use restrictions, allowing you to use the funds for any financial requirements you face. You can use the money to finance an urgent medical need, family expenses, business requirement, higher studies, large scale purchases, etc.

However, there are a few factors you should carefully consider while availing of a fast personal loan in Delhi. Avoiding these common mistakes will ensure you use the funds for your needs and don’t face any difficulty while repaying the credit.

Here are some of the common mistakes you should avoid:
Not comparing the available options –

You should do thorough market research to know your available options before selecting a lending institution. Several financial institutions might offer you different options suitable for your unique monetary requirements. However, applying for too many personal loans in Delhi within a short time span can hurt your credit ratings. Every time you apply for a loan, lenders raise a query to know your financial history. Too many such inquiries within a short period can make you appear as credit hungry and reduce your CIBIL score.

Not checking your repayment capability –

You should carefully select a loan amount that you will be able to repay without risking your finances. Even if you opt for a low salary personal loan in Delhi, you should calculate the monthly installments beforehand to see whether it is easily repayable or not. You can use an EMI calculator to determine the sum.

Withholding existing loan details –

Lenders calculate the loan amount on your FOIR, or fixed obligation to income ratio. Any existing debt affects FOIR as it decreases your repayment capability. You should disclose any existing line of credit before availing a new loan as failing to do so may cause a rejection of your application.

Lengthening the tenor –

Financial experts suggest maintaining a balance between the loan tenor and EMIs instead of opting for a longer tenor for lower EMIs. You should choose the shortest possible loan tenor depending on your repayment capability.

Financial institutions like Bajaj Finserv allow their customers to choose flexible repayment tenors of 12 to 60 months. You can select a term that allows you to repay the debt without straining your personal finances.

They also provide pre-approved offers that make availing loans quick and hassle-free. Pre-approved offers are available on several financial products, including unsecured loans like personal loans and business loans, secured credits like home loans, etc. You can check your pre-approved offer by sharing only some basic details online.

Not checking your eligibility –

Ensuring you meet the lender’s necessary eligibility criteria is one of the most important things you should do while availing a personal loan. Even if you avail a personal loan in Delhi without CIBIL check, go through the terms and conditions or use an online personal loan eligibility calculator to determine whether you are eligible for the credit or not.

Avoiding these common mistakes while availing a personal loan will help you reap the most benefits from the credit. You will be able to utilise the personal loan in Delhi according to your requirement and repay the amount without straining your finances.

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