Personal Loan Tips: Before taking a personal loan, definitely check these 10 hidden charges..

Personal Loan hidden charges: Nowadays it has become very easy to take a personal loan. The loan gets approved in a few minutes and the money comes into your account. But do you know that banks and financial institutions also charge many hidden charges, which are usually not informed to you at the time of taking a loan? These charges can make your loan expensive and put an additional burden on your pocket. Therefore, before taking a personal loan, definitely know about these 10 hidden charges.

1. Processing fee

Banks charge a processing fee for loan processing, which can usually range from 1% to 3%. This fee is non-refundable, that is, even if your loan is rejected, this money will not be refunded.

2. Foreclosure charge

If you repay the entire loan amount before the stipulated time, then the bank can charge a foreclosure charge. This charge can range from 2% to 5%. Therefore, before taking a loan, definitely check this charge.

3. Part-payment charge
If you wish to repay some amount of the loan in advance, some banks charge a part-payment charge for this. It can range from 1% to 3%.

4. EMI bounce charge
If you do not have sufficient balance in your bank account and your EMI bounces, the bank may charge you Rs 500 to Rs 1000 per bounce.

5. Documentation charge
During loan processing, banks may charge a documentation fee for verification of your documents, which can usually range from Rs 500 to Rs 2000.

6. Stamp duty charge
In some states, stamp duty is levied on the loan agreement, which can range from 0.1% to 0.2%. It is decided by the state government.

7. Conversion fee
If you want to change the interest rate of your loan from floating to fixed or fixed to floating, then banks can charge a conversion charge of 2% to 3%.

8. Login fee
Some banks and NBFCs can charge login fees at the time of applying for the loan, which can range from Rs 500 to Rs 2000.

9. Loan cancellation charge
If you decide to cancel the loan after applying for it, then the bank can ask you for a cancellation charge of Rs 3000 to Rs 5000.

10. Duplicate statement charge
If you need your loan statement or any other document again, then banks can charge Rs 200 to Rs 500 per statement.

How to avoid these hidden charges?

Before taking a loan, get information about all the charges and ask the bank for it in writing. Compare the interest rate with other charges. Read the loan agreement carefully. Pay the EMI on time to avoid bounce charges.

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