If you’re applying for a personal loan in Dubai, you’ll need to know a few things to get the best deal. Here’s how you work it out.
A personal loan is your best bet if you’re looking for funds to tide over expenses in the immediate future. The good news is, getting a personal loan in Dubai has not just become simple but also cheaper. Several banks, competing with each other for business, have reduced interest rates on personal loans. You can now expect to get a personal loan in Dubai at an interest as low as 6.7 per cent.
However, you need to be cautious while availing of a personal loan. Here’s how you can get the best personal loan:
Ask yourself if you can repay the loan. If you have incurred debts already and you are unsure about your job status, taking a loan might not be the smartest idea. Normally, you should judge your repayment capacity based on your monthly income and how much of it you require as living expenses. If all of your income goes towards living expenses, you will be unable to pay a monthly EMI.
Shop around for the best package. It is easy to compare loan packages offered by different banks on loan calculators. Alternately, zero in on recommended banks for personal loans in Dubai, compare their interest rates and tenures, and do your research about all the other costs involved (processing charges, transfer fees, late payment penalties, pre-closure charges, etc.). Again, take stock of your income against the proposed monthly outgoing before making a final decision.
Know the interest rate calculation. Normally, the lower your income, the higher will be the interest rate offered to you. The bank may not necessarily offer you a loan at the rate they advertise in the media. Find out what interest rate is being applied to your loan, and why. Also, the interest will be lower if you borrow a higher amount of money. In the end, negotiate for a lower interest rate and study the options for the same in consultation with the bank.
Taking insurance for the loan. If your principal amount is not very large and you intend to pay it off in a short period of time, it is not wise to take insurance for the loan. However, insurance can protect your next of kin in case you are unable to repay the loan owing to an illness, accident or death. Ask for details about the income replacement insurance scheme offered by banks in Dubai.