We must carefully think before getting any particular loan. Whether you are applying for a home loan or just getting a personal loan, learning about all the details will surely help you. In most cases, people forget about hidden charges and pay later.
In this blog, we will talk about those hidden charges, how they can affect your loan experience, issues you might face, and solutions to those issues. You must check one Andro app to learn about available loans in the market and which one would be perfect for us.
Learn About Some Common Hidden Charges Related to Loans in India
Don’t make any hurry while applying for a particular loan in India. It is necessary to check the hidden charges associated with them and the effect you will face-
- Fee for Processing
The processing fee is there for every loan in India. Whenever you are applying for a loan, you have to pay the processing fee. It might vary from 0.5% to 2.5% on the total loan amount. Even if your loan gets rejected, you will not have the money back.
- Charges on Insurance
Are you familiar with loans that come with a mix of insurance policies? In reality, you don’t have to take the insurance. If someone is pushing for it, you can deny it if you want.
- Taxes
GST and other taxes are applicable on loans. The amount you will spend as processing fees and prepayment charges are all under taxation. Talk to an expert who can help you with the tax matters.
- Cancellation Charges
Whenever you cancel any loan, you have to pay some cancellation charges. You can talk to the lending company if you are unable to pay the extra amount.
- Late fee
Late fee payment is also there. If you don’t repay your loan amount on time, the bank or NBFC will charge a certain amount over your existing loan amount.
- Penalties
Are you going to choose the prepayment method? Although prepayment can help you settle your loans in advance and get you relief, banks might impose some fines for that. From 2% to 5% of the pending amount would be the fine amount. Contact the Loan Agency to have better clarity on these matters.
Some Issues That People Face While Getting a Loan
We have seen many professionals are facing challenges while getting a loan in India. Here are a few of them-
- When there are additional charges, it will add some pressure on the person having the loan.
- Still now, a lack of transparency is there regarding hidden charges for loans. Unless we tackle these aspects with a firm hand, it will be difficult for us to create a better system.
- There is no valid source where we can check these hidden charges and compare them with each other.
- Even if you pay the penalty charges, it will still affect your credit score. Try to avoid paying any extra money or making late to avoid these things.
Prepare for these aspects, and you will definitely have better results.
Avoiding Those Issues
We all want to avoid paying extra. The following tips will surely help you achieve that-
- Don’t skip fine print on your loan agreement. There, you will find all the important terms and conditions attached to that particular loan.
- If you have some doubts, better to ask your lender directly. If you are not much expert in these matters, you can also get help from a loan agent.
- Multiple popular websites are there where you can compare different loan options and choose the right one for you.
- It is important to have negotiation skills. It will help you crack a better deal and get better terms and conditions.
- Before choosing prepayment, it is essential to talk to the authority.
- Always look for add-on services and neglect them if you can.
Tricks That Will Help
- Do some homework about possible loans in this country.
- Use EMI calculators and find out the possible amount you have to pay each month.
- Try to have a good credit score, it will help.
Consult with an expert to learn more about them in detail.