Personal loans, due to their easy availability and without any collateral, have piqued the interest of many people. While the personal loans are the most preferred types of loans which are taken by people, there are also still some of the people who are wary of getting a personal loan because of the myths that are surrounding them.

Myth about personal loan

Bank is the best source in order to get personal loan

  • The best possible source in order to get a personal loan is however solely dependent on the particular requirement and the credit history.
  • Not all the lending institutes and banks have the same requirements for the personal loans.
  • They can be said as a good if there wasn’t any alternative for opting for a business loan.

You can get a personal loan only from your bank

  • A few decades ago this might have been the truth. Today it is considered as nothing more than a largely widespread myth.
  • One can also avail a personal loan from any bank or any lending institution that offers the borrower some good interest rates.
  • Additionally, there are also a handful of the lenders that offer an online application process.
  • Over the internet, one can even compare the interest rates from the different lenders and then learn how to apply for personal loan online.

People with bad credit score don’t qualify

  • A bad credit score does not affect the chances of getting a personal loan.
  • However, it affects the interest rates at which the borrower gets the loan.
  • You can still get a personal loan but with more limitations and also at comparatively higher rates.
  • Some of the lenders thus specifically cater to the personal loans requirements of the people with a  bad credit history. However, applicant can go through the interest rate policy of personal loan.

You can borrow more than you need

  • Most of the people tend to get a loan amount that is, however,  more than their requirements just to get a little extra cash.
  • While a borrower  can get a loan up to  INR 30 lakhs which depend on the lender, it’s thus best to avoid getting more than he needs because the borrower would eventually have to repay it along with the interest.
  • That’s just sending the borrower’s hard-earned money down the drain. Therefore, the borrower must keep a frugal mindset when he is taking a personal loan in order to succeed long-term.