” Sir, my mother needs immediate bypass heart surgery. Can you please arrange a loan? She may not survive without this operation. Sir, please help me with a loan. “
Or
” Sir, the marriage of my daughter was being fixed as we finally found the exact man we needed for our daughter. I need an urgent loan within a week. Sir please help me. “
We often have heard of these problems in our regular days. These incidents are very much common in our life-cycle. Hence, we have to be dependent in our life at least for once. Whether it is our luck or unluck we have to go to certain places to fulfill our needs, like banks ( government or non-government), NBFC (Non-banking financial company ), some private lenders, or any license holder’s organization.
But unfortunately, we don’t use to get the loans as per we need. We don’t get the sufficient amount we need. So how can we be eligible for the amount that we will be needing as a loan?
It is pretty much important to acquire some knowledge on certain topics.
Credit rating
Credit rating or credit report is a very important subject to acquire knowledge about before applying for a loan. Some terms and differences are needed to pay attention to.
Credit report
The credit report is a rating system by which it is determined whether someone is eligible for taking a loan or not. It is a detailed report that includes that person’s previous loans ( the loan amount, the name of the loan providing organization, EMI percentages, etc. ).
Many of us don’t know the difference between credit and cibil scores.
Credit score vs Cibil score
Many of us have this misconception that there is no difference between credit score and cibil score. Credit information bureau India limited or Cibil is also known as trans union cibil which is used to generate the credit report. But Cibil is not the one and only company to create the credit report. There are more like, Equifax, Experian, and CRIF Highmark but Cibil is being prioritized by most banks and financial organizations.
Credit report vs Credit score
Firstly, a Credit score is a score between the numbers 300 to 900, which determines how eligible you are to get a loan. It shows how punctual and responsible you are in case of paying back.
A credit report is a detailing of your previous loans like how many times, on which dates, and from which organizations you have taken loans.
The required documentation is being verified properly
Many of us neglect the fact of verification. Your documents will be verified with proper guidelines. So use only verified documents.
Minimum income source
You should have a minimum income source to meet the requirements of taking a loan. You should earn a minimum amount of 15k or if you are a business owner you should maintain a sum of 10 thousand balance in your bank account. The transaction statements play a key role here. The last 6 month’s bank statements should be fine and fair.
No shortcuts or settings
No illegal approach should be taken in any way while applying for a loan. In many cases, you may get a loan but this can harm you in the future. For example, if in the first place you get a loan through illegal means, you may be penalized in any subsequent legal inquiry and you may have to immediately repay the loan institution that took illegal means.
When should you apply for a loan?
Read this very seriously, it is clear that you should apply for a loan when you are financially well off or in need. Because it is a social rule that people trust to give money to those who already have money.
How much amount should you give while taking a loan?
The answer is Zero (0). Yes, a big zero. Some agents or intermediaries get acquainted or someone calls you suddenly and says that he will give you a loan and for that he demands some money in advance or some money as commission after the loan is done. You must refrain from such mischief. Because whenever you’re getting a loan, they are already getting a commission for that. The money is being collected from the processing fees. Any representatives from any bank or money-providing organization don’t expect any extra money from you. Their only motive is to give the exact amount you want.
The preparation before taking a loan
It is very important that you understand the significance when you are asking for a loan from someone, you are definitely lending money to someone and it is not desirable for any reputable person. In that case, if you have to take a loan somewhere there should actually be a reason for it, and plan for it at least 6 months in advance if you are a businessman and at least 3 months in advance if you are an employee. The time limit I mentioned is that if you start preparing within this time frame, it is only possible to get a loan by submitting the kind of information, proofs, or documents that are required in a legal way.
Now your question is if my mother gets sick or my daughter is mature enough for marriage, won’t I be able to get a loan?
See, this totally depends on your personality and income source. If you meet all of the requirements, you will surely get a loan. You should have a clean bank statement (especially the last 6 months) to submit. If you want to enjoy your life and don’t want to take a loan, leave your questions in the comment box below and If you don’t want your friends and family, to get into trouble, share this article with them. Thank you.