Update: March 25, 2021 10:51 a.m. STI
Gurgaon (Haryana) [India], March 25 (ANI/BusinessWire India): Everyone has seen the end-of-season discount banners “Up to 50% off” displayed outside shopping malls. When someone walks in, they realize that most items are discounted, but not as high as advertised. Invariably, those they actually like get little or no discount.
For retail loans, lenders advertise loans based on “starting rates” at an attractive rate with an asterisk “T&C apply”. Some key questions that the customer faces are:
* What rate will apply to me?
* Am I eligible for the loan?
* What are the other terms and conditions?
* Will I be able to prepay or transfer the loan easily?
This is exactly where Loancare”>MyLoanCare.in comes in. Active portfolio management is a concept that most Indian investors can relate to, but borrowers do not when it comes to loan management.
Today, EMIs account for between one-third and two-thirds of an average household’s monthly expenses, making “active loan management” an absolute must, especially when there are hundreds of loan offers. ready “advertised” from which to choose. Active management of a loan begins before taking out a loan and continues even after taking out a loan. The process begins with researching and comparing loan offers from several banks on interest rates and all loan terms.
“Applicable” Vs “Advertised” rate
loancare”>MyLoanCare compares loans based on the “applicable interest rate” as opposed to the advertised rate.
This online market constantly searches for loan offers from all the major lenders in the market and integrates the detailed rates and conditions into their database which is hidden behind their algorithms. When a person checks with them for a loan offer, the organization tells the borrower the “applicable” rate, which is the rate at which the borrower is likely to qualify for the loan instead of the “advertised” rate. “.
To put that into perspective, a bank advertising home loans starting at 6.65% may also charge rates as high as 11%. Similarly, a personal loan provider offering the lowest rate of 10.50% may also charge 24% on the loan depending on various factors such as the customer’s income, age, loan amount, length of loan. loan, credit rating, existing obligations, employer category, job stability. and many other such factors. In the case of home loan, factors such as property type, transaction, stage of construction, size and other property variables also determine interest rates.
Advertisements and news portals, or even bank websites, rarely offer such detailed rates or comparisons instead of focusing only on the lowest rate offered.
What are the eligibility criteria?
Each lender has their own eligibility criteria and specifies several parameters, including demographics, credit profile, income, and ownership (in the case of a home loan). Even if a lender actually offers a loan at the advertised rate, what is the assurance that, as a borrower, he is really eligible to obtain a loan from this bank or lender? He/she may not qualify for a loan from the lender who offers the lowest rate but ends up applying there. Eventually, the application is rejected, leaving them little time to apply elsewhere.
Again, Loancare”>MyLoanCare systems have captured the science to know if a person meets one or more lender eligibility criteria. So when they share their profile with Loancare”>MyLoanCare.in, the system does not not only gives the options, it filters out those where they are unlikely to qualify and tells them the chances of their loan being approved. This helps the borrower decide which lender to apply with.
“T&C Apply” decoding
Also, loan selection should be based on the interest rate and fees such as processing fees, lock-in period before prepaying a loan, foreclosure fees, and other associated fees. Customers have to make several decisions such as fixed or variable rate, PLR or RLLR, EMI or bullet repayment option, whether or not to benefit from an overdraft facility, duration of optimal loan, to have a co-applicant or not. The list of decision points is long, which can be confusing for a common borrower. No bank can ever give the borrower the support needed to help them make the most favorable loan decision for obvious business reasons. This is where a marketplace like Loancare”>MyLoanCare.in offers immense value to potential and existing borrowers.
Keep “Exit Option” open
Contrary to popular belief, loan servicing does not end with a borrower obtaining a loan, but continues to be valid as a concept for existing borrowers. There is no reason for a borrower to be stuck with their existing loan when there are enough choices available to optimize their interest costs over the life of the loan. Borrowers should keep their loan exit option open either by prepayment or by transferring the loan to a new lender for a reduced or top-up loan.
Therefore, there are additional parameters they need to consider when taking out a loan, including the lock-in period and prepayment charges. loancare”>MyLoanCare guides borrowers towards active loan management by including these parameters in the comparison tools, automatically calculating the savings potential and actively contacting existing borrowers with various possible savings opportunities at different stages.
The market as a concept is increasingly used by consumers for every item they buy, use or consume in daily life, whether it is clothes, cell phones, cars or real estate. and even investments. With a similar concept and a significant value proposition in terms of solving a borrower’s various problems, marketplaces are also making rapid inroads into the lending segment and emerging as the advisors of choice for potential borrowers.
This story is provided by BusinessWire India. ANI shall in no way be responsible for the content of this article. (ANI/BusinessWire India)