Common Myths about Personal Loans Busted - Personal Loan Blog - Tata Capital

Personal Loan Myths People Believe In

Feb 28, 2017

Personal loans, due to their easy availability without collateral, have piqued the interest of many people. While personal loans are the most preferred types of loans taken by people, there are still some who are wary of getting a personal loan because of the myths surrounding them. So, here we are, debunking some common myths about personal loans.

Myth: Bank is the best source to get personal loan

The best possible source to get a personal loan is solely dependent on your particular requirement and credit history. Not all lending institutes and banks have the same requirements for personal loans.

Myth: You can get a personal loan only from your bank

A few decades ago, this might have been the truth. Today it's nothing more than a largely widespread myth. You can avail a personal loan from any bank or lending institution that offers you good interest rates. Additionally, there are a handful of lenders that offer online application process. Over the internet, you can even compare interest rates from different lenders and learn how to apply for personal loan online.

Myth: People with bad credit score don't qualify

A bad credit score does not impact the chances of your getting a personal loan, however, it affects the interest rates at which you get the loan. You still get a personal loan but with more limitations and comparatively higher rates. Some lenders specifically cater to the personal loans requirements of people with bad credit history.

Myth: You can borrow more than you need

Most people tend to get a loan amount that is more than their requirements just to get a little extra cash. While you can get a loan up 30 lakhs depending on the lender, it's best to avoid getting more than you need because you will eventually have to repay it along with interest. That's just sending your hard-earned money down the drain. Therefore, keep a frugal mindset when taking a personal loan to succeed long-term.