Are you considering getting a personal loan to fuel your financial choices? Well, the loan is a great opportunity and offers you flexibility like no other. Personal loans can be used as per your desire - you can use the funds to serve any kind of expense. Simply put, it is a convenient credit pick that does not require you to present collateral. You can get an instant personal loan anytime, as long as you meet the eligibility criteria.
While a personal loan is a lucrative offering, it comes with several associated charges. Not being mindful about the same can make the charges run into bigger expenditures over a period. Read on to know more about the hidden charges that you must note when getting a personal loan.
There are several charges that are involved with a personal loan. Some of the important ones that you must be aware of include:
A late payment fee is levied when you do not pay your EMI on time. This charge can range anywhere between 2% to 3% depending upon the EMI costs. Typically, the late payment fees are levied along with GST charges.
Processing fees for personal loans are charged to cover the costs incurred during the application process and disbursal. The amount varies depending upon the percentage of the borrowed loan amount. It also differs based on the conditions laid down by the lender.
As the name suggests, the foreclosure charge is levied when you foreclose a personal loan before the end of the tenure. Suppose you opt for a loan tenure that spans over 10 years but choose to close the loan earlier, you will have to pay the foreclosure costs.
There are important steps that you can take to avoid hidden charges on a personal loan. These include:
When you apply for a personal loan, there is an agreement shared between you and the lender. This document includes all the terms and conditions relating to the debt. This is a vital document and you must take enough time to evaluate its contents. Read carefully to find any hidden costs that you may have not been told about when getting the loan offer. While the agreement is a detailed document that can take some time to completely read, you must not skip the step. Stay well-tuned with the terms to avoid future conflict.
The agreement carries information on the different charges that may be mentioned using different terms. This is why you must importantly get in touch with the lender to obtain clarity. Read the terms carefully before you agree to deal. This reduces your chances of paying hidden costs in the future.
Taking note of the charges and being diligent with your checks before getting a personal loan will go a long way in ensuring that you enjoy the best deals. You can avoid the hidden processing fee for personal loans, high interest rates, and more. If you are looking for a transparent loan process, Finserv MARKETS curates for you the best financial products. The competitive offerings from the best lenders will ensure that your entire process is convenient.