How to get a loan?

Finances can fall short at any point in life and if there aren’t enough savings we need to rely on loans. If you are looking for getting a loan, there are a lot of ways and options. However, before hastily borrowing from anywhere, first you have to think clearly and decide what’s best for you, or else the loan might become a burden for you in the future.

Purpose of the loan

The very first thing you need is to be clear about the purpose of the loan. Why do you need a loan? Loans can be sought for higher studies, for personal reasons, for getting a house or a car, or for treatments or surgeries, and so on. There are many governmental, nationalized and private banks as well as public and Private Finance Companies offering student loans, personal loans, home loans, car loans, medical loans, etc. Choose the type of loan you need based on your requirements. For example, if you need money to fund your college education, you will need to opt for an education loan.

Amount of loan

The next question you need to ask yourself is how much you need? Let’s say you are taking an education loan for college. You will need to calculate how much money you will need (consider the admission fees, tuition fees, exam fees, as well as expenses for accommodation and other miscellaneous charges as required). You can either borrow the entire amount needed or only a part of it, in case you have some savings.

Eligibility and other criteria

Having decided the amount, check whether you are eligible to apply for the loan. Different public and Private Finance Companies and banks have different criteria for eligibility. The rate of interest, securities required, the maximum amount loaned, etc. vary between different banks and financial institutions. Carefully compare between them to find out which works best for you. When you have decided on a particular bank or financial company, calculate the monthly instalments in which you will need to pay back the loan. Finally, approach the bank/financial institution and submit your documents and apply for your desired loan.