All About Pre-Approved Loans
Banks offer existing customer with a clean track record or a good bank balance the choice of Pre-Approved Loans. These are available for Personal, Home, Car or as a loan on Credit Card. Each of these offers comes with a loan amount cap and a time window for availing the loan.
These loans are broadly offered under two categories:
- Secured Loans
- Unsecured Loan
Questions to answer before you go ahead and avail any of the offers from your bank:
Do I really need the loan?
It is the most important factor to keep in mind before you go ahead and avail the loan. Most banks will keep calling you to share the offer and push you to sign up and avail the loan. However, it is important to ascertain your real requirement if any.
What is the amount that I need to avail?
In case you a genuine need to take a loan, the next important question, to answer, is “how much?”. You may be good credit customer with the bank and basis that the loan amount which is pre-approved may be high but it is not wise to take the entire amount unless you really need to. Therefore, keep in mind the real requirement and not the amount that is pre-approved.
Know the Rate of Interest that the bank is charging.
Taking a pre-approved loan may get you the loan delivered faster, but one should know the real rate of interest that is being charged on the housing loan and then compare with the other options available in the market. Just getting a pre-approved loan with a faster delivery time may not mean that you end up paying a rate that is much higher than other lenders.
Documentation for Pre-Approved Loans
Most of the pre-approved offers come with a disclaimer with respect to the documentation. Before the bank goes ahead and gives you the loan, they may require all documents to be made available and be in order. Any discrepancy may lead to the offer being revoked.
One should avail any such offer only after evaluating the above factors. However, in case you are in a hurry to buy your next car or move into a new home, a pre-approved offer may come handy and help you save time.
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