Predicting one’s financial future is almost impossible. Any business owner may be confronted with a crisis, mishap or a failure in their company without due warning.
Such situations usually present themselves unannounced and if you are not prepared, it could leave you reeling under its impact. But, sometimes the best preparations, which could involve a sufficient reserve fund, might not be enough to keep your head above water.
So, what other alternatives are you left with at this point?
The only alternative left with you in such situations is to borrow. But, it is still possible that the approval process for your loan application drags on for a long period of time or that your application might be rejected completely.
Below are some financial habits that you can adopt in order to get a loan fast:
- Be on time with your bills
Paying off your bills on time is a very good habit. Paying off the EMIs on your loans or credit cards and service charges bills on time indicates that you are competent with your financial duties and obligations.
Adopting this kind of habit results in a good credit score, which can increase the chances of acquiring loans in the future with minimal hassles.
- Try to pay more than the minimum balance limit
By paying more than the minimum balance limit you will reduce your outstanding amount, which will also improve your chances of paying off the loan before the time period of the repayments. By doing this, you also stand to save a lot of money on the interest. Avoid maxing out your credit card up to its full limit, as it doesn’t leave a good impression and shows that your financial condition is not sound.
Maintaining good financial habits will also increase your chances of being approved for a loan faster in the future as well.
- CIBIL report and CIBIL score
The credit report is the foremost thing that a lender looks at before approving a loan. So, it’s important for you to know about your CIBIL score. Its better that you check your CIBIL once a year in order to know whether or not you need to improve upon it.
It is also very possible that your CIBIL report consists of errors that are bringing your overall score down. If that’s the case get in touch with your lender regarding the rectification of any errors, so that it can be reflected in your CIBIL score immediately.
- Research for a good lender and know your options
If you have decided to take a loan then it’s important for you to choose your lender wisely. The lender you choose will be responsible for your entire loan process and many other things such as interest rates and other charges.
If you pick a good lender, the complete process of borrowing will become easy and there will be quick loan disbursal as well.
Loans are a great source of acquiring additional funds. However if you are currently making repayments for a loan, it is advisable to not take out another loan, as your interest payments for both loans will begin to stack up. A good rule of thumb is to ensure that your aggregate month to month EMIs does not exceed 50% of your monthly income.
For people in the UK, another important thing to keep in mind is to check if their loan agreement has a PPI (Payment Protection Insurance) policy attached with it.
Many people in the UK have been mis-sold PPI policies by their lenders. If you are a self-employed person, you are ineligible to claim from a PPI policy, making it worthless to you. Also, if you remember being sold a PPI policy previously, now would be a good time to make a claim for refund, because the claims deadline is fast approaching.
- Assess financial requirement
It’s important that you assess the financial requirements for the loan carefully before applying for it. Applying for large sums mean that you will also be saddled with high interest payments that you might not be able to consistently repay.
Similarly, applying for a loan amount that is lesser that what you actually require might force you to take out another loan to make up for the deficit amount, which will land you in a similar situation in terms of having to make high interest repayments.
Also, check the eligibility criteria of the loan before applying. Nowadays, one can easily apply online for any loan amount. All it requires a complete online research. There are numerous moderator websites that can assist you with comparing loans and interest rates provided by money lenders and can select the one as per your conditions and requirements.
- Proper application
All the above points will only work if you fill out your loan application in a proper manner. Applying properly implies that the application needs to be filled completely and duly signed along with a self-attested photograph and necessary documents that is required for the loan.
A correct application form is:
- Filled with authentic information
- Consists of all the documents and photographs along with the application
- Specifies the entitled loan sum and tenure.
Remember, an incorrectly filled application might take a long time to process, therefore hampering your chances of being approved.