Victoria, Australia, In today’s world, everybody has their own realistic and imagined goals for which they need finance. The lenders and finance companies have seen the opportunity between the reality and aspirations of customers. They are targeting potential customers with so many lucrative opportunities in finance world. Caveat loan is also a result of same efforts put in by many lenders. These loans can give you easy and quick access to the cash. Technology has really helped lending firms and people to reach to their potential customers. For customers, the use of technology has helped them to take the loans in their desired timelines. At the same time borrowers need to ensure that they are not taking loans more than their desired amount. Here in this article we have listed some tips while applying for a loan.

#Don’t borrow more than your limit

The first golden rule of borrowing is that don’t go for the amount beyond your limit. Always take a loan that you can easily repay without hampering the money used in other important things such as your retirement plans, child’s education etc. As per the financial experts, your EMIs should not exceed 20-25% of your net income. Till the time, you are in this range you are stressed free. The moment your EMIs exceeds this range, it’s an alarming situation for you . This competition has made banks loan withdrawal an easy and flexible options for customer. But that doesn’t mean customers should simply go for a loan because it’s available.

# Try to keep tenure as short as possible

Considering an example of home loan the maximum term offered by all major lenders is 30 years. Some people find it convenient to have longer tenure as it gives them lower EMIs. However, it’s not the case the longer the EMIs would be the higher the interest rates will be. It’s best to take loans for short tenure. Loans with longer tenure generally tend to have higher interest rates. Sometimes for a younger borrower it’s not possible to have short tenure with an increased EMIs. But in this case one can increase the EMIs with an increase in the income in near future.

# On Time and Regular Repayment

It requires very disciplined approach when it comes to repayment of loans. Be it housing loan, short-term loan or credit card payments, never miss on any of the monthly payments. By chance if you miss to pay any EMI or forget to pay your credit card bills, it will impact your credit history badly for sure. If you do so, you would not only be charged a hefty amount of penalty but also liable to pay healthy amount of interest on the unpaid amount.

# Go for Insurance with big loan amounts

In case you are taking housing loan it’s advisable to go for insurance of same amount so that your dependents don’t go through the pressure of repayment of loan in case of any accident.
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