The hassle-free application process, low-interest rate, zero collateral, and instant disbursal of funds makes personal loans a preferred credit option when unplanned expenses arise. To make sure your loan application is not rejected, avoid these pitfalls while applying for a personal loan.
Not keeping track of credit reports: Maintaining a good credit score means a lower interest rate on your loan amount. Make it a point to keep your credit score above 750 to avoid your loan application from being rejected. At StashFin, you can avail a personal loan to improve your credit score by availing a loan and making timely payments.
Not comparing lenders: It is important to compare lenders before zeroing in on the best deal that is suitable for you. Don’t just restrict yourself to one lender based on the interest rate they are offering. Ensure that you consider things like eligibility criteria, processing fees, loan tenure, prepayment charges, etc., At StashFin, you can avail a personal loan at low processing fees, minimum documentation, and zero hidden charges.
Loan repayment capacity: It is important to choose a realistic loan repayment term. While a longer tenure increases the total interest paid, a shorter tenure results in higher EMIs. The StashFin EMI calculator can help you calculate your monthly EMIs and accordingly plan your finances. StashFin also offers flexible EMI tenures ranging from 3 to 36 months.
Submitting applications to multiple lenders: Applying for loans simultaneously with multiple lenders will give rise to the initiation of hard inquiry. This will not only reduce your credit score but also restrict your loan application from getting approved. Instead, research the marketplace for a suitable lender rather than applying with multiple lenders.
Not calculating the budget: Although you may be eligible for a higher loan amount, a high EMI can affect your credit score when you default on your payments. To avoid paying interest on funds you don’t need, ensure that you plan your budget before applying for a loan. StashFin offers personal loans with absolute transparency at low-interest rates starting from 11.99%. Also, you pay interest only on the amount you use and not the entire credit.
Applying for additional loans: Financial institutions keep track of new transactions. Purchasing on credit during the loan application process can impact your credit score because lenders view this as spending more than you can afford. So, it is better to focus on one loan at a time.