How Do You Avail Personal Loan for Closing Costs of the Loan?
The loans you avail from the banks or the moneylenders help you achieve your desires and dreams, but there are things that can bring you trouble after getting your personal loan sanctioned. The costs that the banks charge you can give you nightmares.
As they have a major impact on the final repayment amount. Some banks and moneylenders charge closing costs to end the transaction. These transactions result in a big some of the money. In some cases, these closing costs might help you save money.
These closing cost can range from few thousand rupees to a lakh depending on the amount that was taken as a loan from the bank. Basically, the closing cost can be up to 2 percent to 5 percent of the loan amount.
For instance, if the loan amount was INR 50 Lakhs and the closing amount has been charged to 5 percent of the loan amount, then the closing charge might result up to INR 25 thousand.
Some people might not be in the condition to pay the amount due to some emergency. They can pay the money by availing a Personal Loan for closing cost from the banks.
The Personal Loan from the banks ranges from INR 50 thousand to 10 lakhs. You can avail up to 10 lakhs depending on the purpose of the loan and the application for the money. To avail a Personal Loan you might need to follow the procedure laid by the banks. You have to be eligible according to the criteria of the banks. They are:
- Good Credit Score: The bank while lending the Personal Loan to the applicant checks the credit score of the applicant. The credit score is provided by CIBIL according to the previous repayment of the loans done by the applicant. You need to have a good credit score for your Personal Loan to be approved quickly.
- Documents: While applying for a loan you need to make sure all the forms are filled correctly and all the formalities are done properly. There should be no error in the documentation and all the documents should be correct and authentic. If the documents are correct and proper according to the banks your loan approval chances will increase.
- Tenor of Repayment: The tenor of Personal Loans are usually lower as they have less money involved in them. The maximum tenor for a Personal Loan is 5 years.
- The Rate of Interest: The banks and money lenders charge a higher rate of interest due to the shorter tenor. The Personal Loan Interest Rate can range from 11 percent to 12 percent.
There are two types of Personal Loans you can apply for: secured loans and unsecured loans.
Secured loans: This loan is given by the banks and moneylenders. The applicant has to offer collateral to the banks. The collateral can be a car, house, or funds. The interest rate for these type of loans is low as they tend to be more secure and have less risk involved for the money lender.
Unsecured loans: In this type of loan, you don’t have to offer collateral to the bank for the security of money lender. The interest rate is higher due to the risk involved for the moneylender. These loans can be availed by the people with a bad credit score.
You can easily avail a Personal Loan to pay the closing cost of any other loan. The applicant has to make sure that his credit score remains maintained throughout the repayment of the loans. While applying for a loan you need to see that the charges that the banks are charging you should not go unnoticed.
Category: Loans
