Representative image. PTI
Customers with a strong credit history can opt for a variety of benefits, one of which is a pre-approved personal loan. This loan is an example of an unsecured loan. Applicants for a pre-approved loan usually have a strong credit history with their bank. One of the crucial conditions is to consistently maintain a high credit rating over time. If you have a history of consistent and timely repayment of current and old loans, your strategy will be further strengthened. The lender may consider your income level before granting a pre-approved loan to estimate your ability to repay it.
Advantages of the pre-approved loan:
If you take out a pre-approved loan, you can get many benefits:
- You can avoid waiting for loan approval if you have a pre-approved personal loan offer. The lender already knows your credit history and has access to your KYC documents.
- Pre-approved loans often have more attractive interest rates than regular personal loans. The lender may sometimes grant special privileges such as waiving processing fees, prepayment penalties and foreclosure fees.
- You can apply for the loan online, which is an added advantage. It’s easy to apply online or using a mobile app.
Notably, pre-approved loans are only available for a limited period. This is why timely decision making is so crucial. If the pre-approved personal loan offer has reasonable interest rates and additional incentives, accept it if you need the money and can easily pay it back. You must ensure that you receive the exact offer presented to you before accepting the pre-approved loan. It is also very important to select the right repayment schedule initially.
If you know what to do with money, it makes sense to accept such offers. Since you have to repay the loan amount plus interest, you should not take out a loan just for fun or for unnecessary expense. If you have a good plan and are already looking for a loan, pre-approved loans can be a low hanging fruit. Before taking out the loan, it is essential to make sure that the amount of the loan granted will be sufficient to achieve your goal. You should also check the terms and conditions of the loan as well as the interest rate, hidden costs and other expenses.
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