Personal Loan Tips: In today's time, personal loan is a facility that helps in meeting the financial needs in difficult times. Be it wedding expenses, medical emergency, home repair or need of funds for higher education, personal loan is an easy solution for all these needs. But have you ever backed out from taking a personal loan due to any misunderstanding? Let's know 5 such misconceptions and their reality too.

Myth 1: Only salaried people get personal loan

There is a misconception among people that personal loans are only for salaried people. This is not the case at all. Self-employed professionals, business owners, startups, and pensioners can also take personal loans. Even if you are not salaried, you have to show your stable income to get a loan. Lenders check factors like stable income, credit score, and type of employment before giving a personal loan.

Myth 2: Loan will be rejected due to low credit score…

There is a misconception among people that personal loans of people with low credit scores will be rejected. People with high credit scores indeed get loans easily. But this does not mean that if you have a low credit score, you will not get a personal loan. While giving personal loans, lenders look at your age, job stability, payment history, etc. apart from your credit score.

Myth 3: Interest rates on personal loans are high…

There is a misconception among people that very high interest is charged on personal loans. This is not true. Usually, interest rates on personal loan are between 10 to 15 percent per annum. If someone has a low credit score, he has missed the EMI of the loan, then the interest rate for him can be a little higher.

Myth 4: If you already have a loan, then you will not get another loan

Many people believe that if you already have a loan, then you will not get another personal loan. This is not true. Lenders check whether you can afford a new loan as compared to your total income and existing loans.

Myth 5: Personal loan is only for personal expenses

Many people think that personal loans is only for personal needs. The reality is that you can use a personal loan for many kinds of needs.

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