Running a business, buying a house or need funds for education? There are numerous reasons why we opt for a loan. Bank offers a variety of loans including, house, personal, car and more. However, getting your loans approved can sometimes be an exhausting task. Rounds of meeting with your bank and loads of documentation, yet no luck? No worries, here is what you are missing when applying for a loan.
- Type of loan you need
It is crucial for you to understand the kind of loan you are looking for. If it is a secured (loan against property) or unsecured (on credit scores) loan you want. Home loan, education loan, mortgage and business loan, there are several such loan options available with the banks. Be sure of the nature of the loan you are asking for and prepare accordingly.
- Can you pay back?
Banks provide loans to individuals who have financial stability as oppose to someone who is already in a lot of debt. It is important for you to review your current financial situation and your ability to pay back. Especially in cases of secured personal loans as the inability to pay back can lead to loss of collaterals.
- Choosing the bank
List of banks providing loans are never ending. You might just get a little too confused with which bank to go with. For situations like these, there are websites like Bankbazaar.sg in Singapore, Finder in US and Rate City in Australia. They provide a list of banks segregated in categories of interest rates, benefits, and tenure. Choose the bank that offers the best deals in your loan category.
Don’t waste a minute; know your eligibility before applying for a loan. No document or bank can help you if you are not eligible for a loan. There are websites that inform you about your eligibility for free, all you gotta do is put down some initial details. So, before you commence get your eligibility checked.
- Get your documents ready
Do you have all the necessary documents in place? List of documents depending on the type of loan you opt for. Call your bank to know all the documents required for your loan type. General documents included
- Income proof
- Bank statements
- Identify proof
- Property proof (For secured loans)
The list can go on and on. Get your documents verified and lined up before you move ahead.
- Do you really need a loan?
This doesn’t really support the issue. However, you’ll need to know if you really need a loan? Are there alternative steps you can take over applying for a loan like borrowing money from friends or family? Consider other options before finalizing.
Everything in place? Your loan will be approved in no time. Verified documents, good credit score, and eligibility are some of the initial steps you take to further the borrowing process. Taking loans requires planning, look ahead into the future example- if you plan on taking a home loan in the future start building a strong financial profile from today.