Understanding Loan Parameters to Get a Better Deal

There are a number of loan options available to the public today. Everyday a new kind of loan is introduced in the market by rival financial institutions in order to attract new customers. Choosing the loan that is best suited to you and your requirements can be difficult and confusing, and that’s why understanding your loan parameters becomes a priority.

What are Loan Parameters?

So what is a loan parameter? It is the factor that is used by lenders to determine whether or not they should provide a loan to a borrower. These parameters might include a good credit score, the interest rates that you can manage and the EMI you can handle. Loans parameters differ according to loan types; for example doctor loan parameters need the borrower to have medical credentials and sufficient practitioner experience, whereas home loan parameters include having a steady, recurring income.

What You Should Do Before You Apply for a Loan?

Before you apply for a loan, be it a home loan, automobile loan, or personal loan, it is important for you to know the amount that you need, the interest rate, and the processing fee. If you want to make a prepayment on your loan, it is necessary to work out your loan agreement to know the amount you need to pay and the regularity of the payment.

You can use online calculators that will work out the pattern of your loan payments depending on the loan parameters. These calculators will show accurate details of the amortisation table, the timelines of your repayments, and total interest. Using these resources will most definitely help you with making smarter decisions and understanding loan parameters in a better way.

Loan Parameters

Below is a list of different factors that influence the loan you choose to take. Here you will learn the functionality of each parameter and how they affect your loan payment.


EMI stands for Equated Monthly Instalment. It refers to the money that you intend to pay every month until the loan is completely paid. If you’ve taken a fixed interest loan, the EMI will remain the same throughout your loan tenure. EMIs could vary, if you’ve opted for a loan with a floating interest rate.

Ratio of Interest and Principal Rates

Even though the EMI is a constant payment throughout your loan tenure, the interest rate and principal amount are not paid in a 50-50 ratio. Your loan provider gives you an amortisation table that will help you see how the interest and principal rates contribute to your EMI. In the initial years of paying your loan, the ratio between interest and principal can be quite skewed, but as time goes by, the principal amount gets higher and higher, peaking toward the end of the loan tenure. Non-banking financial companies like Bajaj Finserv provide special offers on your EMI payments, making repayments less of a drain on your resources.

What is a loan tenure?

The time taken to repay the loan amount in full is a loan tenure. The tenure can be changed according to market conditions. It can increase in case of an interest rate cut or periodic rate revision. The loan tenure for home loan and business loan parameters is usually long-term and for personal loan parameters it is short term.

How Does Interest Work in Loan Payments?

Here’s a well-known phenomenon: the longer your loan tenure, the higher the rate of interest. This happens because every time you prepay, the prepaid amount gets deducted from your principal amount. So even by paying small amounts at regular intervals, you can reduce your repayment tenure drastically. This also decreases your total interest component in the loan. You can apply for loans from financial institutions like Bajaj Finserv who offer home loan interest rates starting from 9.75%.

These loan parameters generally apply to a vast array of loans. The comparison parameters for personal loans are generated with all the factors above and include criteria based on whether the borrower is self-employed or salaried. This eligibility for personal loans differs slightly from bank to bank. The eligibility for home loans largely depends upon your score from the Credit Information Bureau (India) Limited (CIBIL) and whether or not you have a satisfactory flow of income.

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3 reasons why your Doctor Loan has been declined

Doctor loans are quite popular in India, where every other child dreams of becoming either a doctor or an engineer. As doctors enjoy respectable and financially secure positions in society, financial companies have no problems issuing loans to them. However, this is not the case for every doctor in the country – many loan applications are rejected as well.

If you’re someone who’s been declined a doctor loan, then you may be keen on finding out more about the reasons behind the rejection. Here are some of the top reasons for doctor loan rejection in the country:

  1. A Low Credit Score
    Your credit score is the number one factor that financial companies take into consideration before approving or rejecting a loan application. If you’ve neglected to pay your EMIs on time for any of your previous loans, then your credit score will very likely take a hit. The same goes for all those times you’ve failed to pay your credit card bills.

    With a low credit score, chances are that even a highly reputed doctor will be denied a loan. That’s why it’s essential to maintain a good credit score before applying for a doctor loan.

  2. Multiple Loans in Progress
    If you already have a number of other loans that you need to pay back, then your ability to repay a new loan will be seriously questioned by financial companies. More often than not, you will be labelled a high-risk individual in the eyes of your lender when you have multiple debts pending. At such times, it doesn’t matter if you’ve paid all your EMIs on time or even if you have a good credit score; your doctor loan eligibility is inevitably affected in a negative manner.
  3. Fresh off the Boat
    Job stability is another factor that plays a major role in the loan approval process. If you’re someone who’s just graduated from medical school, then obtaining a doctor loan may prove to be quite difficult. In order to grant a loan, your lender needs to be sure of your ability to maintain a certain a level of income. It’s a good idea to gain at least a few years of experience in the field before applying for a loan.

    Financial companies also look at the employment history of those who have been working for a long time. Serial job switching is frowned upon by lenders, who prefer applicants with stable work backgrounds.

If you want to take a doctor loan in India, then you should consider the attractive options that Bajaj Finserv provides. This company offers doctors loan interest rates that are quite low. Depending upon your needs, you can take loans of up to INR 45 lakh with absolutely no collateral.

You can also prepay your loan up to 6 times a year, and if you do decide to foreclose your loan, you aren’t penalised. The online application process ensures that you don’t need to step out of your home. Check out the list of documents required for doctor loan at Bajaj Finserv whenever you want to.

A doctor loan can give you financial breathing space when you need it the most. Apply for one with a reputed lender like Bajaj Finserv, who is well known for providing a ton of benefits.


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4 reasons why you’ve been declined a Credit Card

A credit card can boost your spending capacity, helping you out in times of need. However, not everyone can lay their hands on a credit card. This is because applications are often rejected by the issuers. If you’ve recently been declined a credit card, then you may want to know more about the reasons behind the rejection.

Here are a few credit card rejection reasons to help you figure out where you’ve gone wrong:

A History of Bad Credit

Your credit rating is an important factor in the approval process. For banks and financial companies, your credit score stands as testament to your repayment ability. If you have a low credit score, then you will definitely have a hard time obtaining a credit card.

Whenever you fail to repay any form of credit—whether it’s with regard to home loans, personal loans or credit card bills—your score takes a hit. And a low rating is one of the top reasons why credit card applications get rejected. You can improve your credit score by paying back your previous debts on time.

You Don’t Have a Credit History

If you’re applying for a credit card or a loan for the first time in your life, then you might face some difficulties. Financial companies look at your credit rating as an indicator of your ability to repay loans. But if you don’t have a credit history to begin with, then it’s nearly impossible for the issuer to gauge your repayment capacity.

In order to get past this barrier, it’s a good idea to apply for a credit card at the bank with whom you have been holding a savings or current account for a long time. This is because your bank can analyse your spending habits by going through your account history. You can even apply for a credit card with Bajaj Finserv.

Low Level of Income

Apart from your credit history, card-issuers also look at your income before applying or rejecting your application. Your credit card eligibility is negatively affected when you have a low level of income. In India, financial companies usually grant credit cards to those who have an income of at least INR 1,80,000 per annum.

Employed in a Relatively Unknown Company

Credit card issuers also consider the company where you’re employed during the approval process. If you work in a non-listed private firm that’s not well-known, then your chances of obtaining a credit card may be adversely affected. Financial companies often look at those employed in such companies as high-risk individuals who are prone to income fluctuations and designation exaggerations. Working at an unknown firm is another one of the top credit card rejection reasons in India.

If you’re looking to obtain a credit card from a trustworthy financial company, then consider the services provided by Bajaj Finserv. This reputed firm offers credit cards to both salaried and self-employed individuals. Depending upon your qualifications and requirements, you can choose from either a world credit card or a platinum card. Each time you swipe your card, you win reward points that can be redeemed to avail of an exciting range of benefits. Bajaj Finserv has credit card requirements that you can easily fulfil; and even the documents required for credit card acquisition have been kept at a minimum.

It’s essential to have your finances in order, before applying for a credit card. With a credit card in hand, you can easily make a multitude of purchases, and will never lack emergency funds.

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Business Loan Mistakes to Avoid

5 Business Loan Mistakes to Avoid

Every small business needs a regular infusion of timely funds to grow, expand and reach its potential. As a small business owner, perhaps you too are looking for a Business Loan that may be repaid over a period of time or may be used to meet a short-term requirement. While this is a good plan, make sure you go about getting the right loan for your business in the right way, avoiding these common pitfalls when borrowing money.

Here are the 5 most common mistakes that small business owners make when applying for a Business Loan:

  • Maxing Out Your Credit Cards

We understand that for every small business to grow, it sometimes needs quick cash—whether it is to help the business be more competitive with the crucial 2% cash discount on purchases for consumers or being able to complete a purchase you hadn’t planned for. Once the credit card has been swiped however, the repayment may take longer than you planning. This burdens the business with high interest and may result in affecting the business owner’s credit. Instead of reaching for the credit card to meet sudden expenses, try taking a Business Loan. The Bajaj Finserv small Business Loan with low interest rates is a good alternative to a credit card with its flexible repayment options.

  • Ignoring Information Requests From the Lender

When you take a Business Loan, be alert to all communication from the lender and make sure your communication details are correct. Typically lenders such as banks and financial institutions ask for a large amount of data even after finalising the loan amount, interest rate and repayment term. Failure to provide the required document can result in the business losing the loan. At Bajaj Finserv, the small Business Loans come with an easy application process, hassle-free documentation, low interest rates for small business and easy repayment options, so consider that as you shop for the right lender for your Business Loan.

  • Not Reading the Fine Print

The typical Business Loan document has a lot of terms and conditions printed in small font. These terms and conditions are not highlighted at the time of signing the loan document and often contain conditions that limit the business owner’s ability to repay the loan. These may include a fee on prepayment of the loan amount or a clause not allowing prepayment of the loan amount. Be careful when signing any loan document and ensure you have gone though all the fine print before putting your pen to paper!

  • Borrowing to Create Surplus Cash

It is often a common practice by small business owners to borrow a larger amount than required when it comes to Business Loan with the perspective that it is not easy to get a fresh loan quickly. Small business owners also mistakenly believe that the extra funds will earn interest in their bank’s current account. This is a typical small Business Loan mistake. Your Business Loan should always be for a specific reason so that the funds are utilised in the most efficient way. Bajaj Finserv’s small Business Loans provide the flexibility of depositing any excess cash to pre-pay the loan amount with idle funds.

  • Failing to Shop for a Small Business Loan

Many small business owners tend to underestimate the size of their business and are therefore happy when a bank or financial institution offers them a loan. In fact, what you should do is shop for loans from various lenders with easy documentation requirements, low interest rates and easy and flexible repayment options such as Business Loans from Bajaj Finserv.

Bajaj Finserv understands that small businesses have erratic requirements for money. That is why we provide competitive interest rates, easy repayment options, allow part payment of Business Loans and only charge interest on that part of the loan, which is being utilised.

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Pros and Cons of Balance Transfers

What You Ought to Know About Balance Transfers

The term “Balance Transfer” refers to the process where a portion of funds, either money or credit, is moved from an account in one institution to another. A balance transfer can be a valuable tool to manage your debt, if you know how to go about it. In this article, you will read about the pros and cons of balance transfers along with what you need to know about balance transfers in India.

Pros and Cons of Balance Transfers

The Two Sides of the Balance-Transfer Coin

Every story has two sides, the same principle can be applied to balance transfers. If you have decided that this is the track you want to follow, then you need to know all the elements in play including the advantages and disadvantages of balance transfers.

Tempting Interest Rates

This is probably the first factor that got you thinking about making the leap. It makes it appealing because when you think about your finances in the long run, it makes sense to retain as much as you can. With balance transfers, you are given that chance.


Although the term “fee” would tend to make you sceptical, you will have to work out whether the fee charged is worth the shift. In almost all cases, the fee is nominal compared to the figures of the prior interest rates.

Read the Fine Print

Although this strategy is a fine finance management tool, it only works if you play fair and abide by the rules. So read the contract carefully, even the small print. This would help give you a better understanding of the agreement you are entering into with the institution.

Types of Available Balance Transfers

The various types of balance transfers in the financial world include credit card balance transfers, and loan transfers.

Home Loan Balance Transfers

A Home Loan balance transfer is where you are given the choice by a new financier to opt for lower interest rates on your Home Loan payments. If you have your debt balance transferred to a service provider like Bajaj Finserv you can rest assured that your Home Loan will come at the some of the lowest interest rates in the country.

Personal Loan Balance Transfers

With a personal loan balance transfer, you will find the interest you pay in the long run would be comparatively lesser. With Bajaj Finserv for example, if your loan transfer eligibility is met, they would take on the balance of your Personal Loan at much more competitive personal loan interest rates.

Credit Card Balance Transfers

A credit card balance transfer is apt if you have large amounts to pay off on your card. The amount you have to pay will be covered by the institution you transfer it to. The company, in turn, offers you a lower interest rate.

The Upside and the Downside to Balance Transfers

A balance transfer could be what you need to pay off your debts faster. When looking at the bigger picture, these transfers help in saving money. But they can be risky to take on as well. With balance transfers, you open yourself up to more debt by spending more. For instance, credit card balance transfers would reduce the payments you make on your existing bill but it can also lead to you spending more on either the old card or the one with lowered interest.

Balance transfers would be convenient for you if you are looking to clear your debts while keeping a check on how much you spend in the process. With the right research and strategy, this entire scheme is pretty much a no-brainer.

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A concise guide to Doctor Loans: the what, the why, and the how

A doctor loan, sometimes referred to as physician’s loan, can be availed by any practicing doctor in India working in their own clinic, or in a government or private hospital. Even doctors working as consultants may apply for a doctor loan. These loans are provided exclusively to doctors and may be used for any of the following.

Why is a Doctor Loan a Smarter Choice?

Doctor loans are designed specifically to meet the needs of medical practitioners. Medical infrastructure is quite expensive and usually requires a large amount of money. What makes a doctor loan in India special is the convenience of borrowing a large sum without the need for any guarantors or collateral.

For example, Bajaj Finserv provides Doctor Loans from INR 5 Lakh to INR 45 Lakhs, which is the highest unsecured ticket size offered by any online loan provider in the country. Along with a long loan tenor of up to 60 months, the doctor loan interest rate is also quite low, making these loans the obvious choice for any doctor planning to invest in their practice, and grow their career.

How Do You Avail a Doctor Loan?

If you’re a practicing doctor, you’ve already met half the eligibility criteria needed to apply for a doctor loan. Apart from this, you need to have a few years of experience to cover the basic requirements. Banks usually have an experience requirement of 3-8 years, depending on your qualification, either in a private practice or as a doctor in a hospital. Read More: Give your patients the best medical care

The documents you need are quite similar to availing a personal loan, like proof of age, proof of identity, and proof of residence/work. The additional documents that you need to secure a doctor loan include your educational qualification certificates and details of your IT returns.

Nowadays, if you’re planning on getting a physician’s loan, you don’t even need to go all the way to a bank. Companies like Bajaj Finserv allow you to apply for a Doctor Loan from the comfort of your home or clinic. You just fill up a simple online application form, and your doctor loan can get processed, approved, and even disbursed, all in a matter of minutes.

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Personal Loans: The basics

Sometimes your bank balance keeps you from achieving what you desire, and that is where a personal loan comes in. In this article, you will read about the basics of a personal loan and what contributes to you getting one.

Personal Loan 101

When talking about personal loans, you should know and consider the following factors before applying for one.

Type of Loans

There are two types of personal loans, namely secured and unsecured. Secured loans are termed so because they require collateral, like a house or a car. This type of loan generally has lower personal loan interest rates. When you look at unsecured loans, although you don’t have to pledge collateral, the interest rates for these loans are higher. The increase in the rates are probably due to the uncertainty of whether the institution will be repaid in full or not. Student loans are the only type of financing where collateral is not required and the interest rates are still low.

Interest Rates

Like the types of loans available, there are two kinds of interest rates you can opt for. Fixed interest rates are exactly as the name suggests: they remain the same throughout the lifespan of the loan. Variable interest rates can change in time based on the standard market rate. Usually, personal loans have fixed interest rates. Financiers like Bajaj Finserv offer rates that are based on loan amounts, which are detailed on their website.

Deal with a Known Institution

Any personal loan guide would tell you that entering a contract with a company you have a relationship with or know is probably your safest bet. Depending on what you want the money for, the financier may have better options for you to choose from if you go with someone who knows the playing field.

Make Sure You Go Down the Checklist

The following are a few elements you should before you start the borrowing process:

Calculate EMI and Tenure

Make sure you know how much you can spend and for how long you can spend it. By figuring out the time period it will take to repay the loan, you are preparing yourself for it. Most personal loans come with a time frame of one to five years to repay the borrowed amount plus interest. With the proper strategy and research, you would be able to ensure you clear the loan in no time.

Do Your Research on Interest Rates

There are quite a few financiers available today to cater to your loan needs. In order to choose the best one, you will need to do your homework on each provider and the rates they offer.

Get Your Paperwork Ready

A few documents are asked for when you apply for a loan, like photo ID proof, income proof, bank statements, and address proof. Ensure you get the required papers sorted and ready so that the process sails smoothly.

To get the best out of your loan, all you need to do is zero in on what kind of loan you want, how much you want to borrow, and research what you will need in order to get your loan approved. Once you get those factors sorted, the only element left to see to is identifying the financier. Many firms like Bajaj Finserv offer online application services for loans, which is worth looking into if you are keen to set the ball in motion.


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Partner up to buy the home you’ve always wanted!

Investing in real estate has been a profitable scheme, especially given the appreciating value trends in recent years. So if you are looking to invest in a property, opting for a joint home loan will not only help you ease your financial crunch but also benefit you by giving you additional tax breaks. Some financial institutions offer online accessibility to the application process. For instance, with Bajaj Finserv you can access your online account to apply for a Home Loan 24×7.

If your income alone isn’t sufficient to secure a loan, going for a joint loan with a family member will make your application more eligible for approval. One of the best things about having a co-applicant in home loan is the shared accountability in the repayment process. If that’s not enough, each co-applicant’s home loan tax benefit can be claimed separately—up to 1.5 lakh per applicant under the Section 80C of the IT Act.

But before we go any further, here are some things you should know about the role of a co-applicant in a home loan.

Who Can Be a Co-applicant In a Home Loan?

A co-applicant or a co-borrower can be a parent, sibling, or even your spouse. For anyone to be eligible for a joint home loan, they need to co-own the property. Banks generally insist all the co-owners to be a part of the joint loan, as the maximum number of applicants allowed can go up to 6. But know that sisters, unmarried couples, and friends are not eligible for a joint home loan.

What Documents Do You Need?

Identity proof, address proof, income details, tax proofs, business continuity proof, bank account statements for the last 3 months, and property-related documents are some of the basic documents you need before applying for a joint home loan.

Are You Eligible?

Eligibility for a joint home loan increases as the repayment capacity increases. The income of all the applicants involved will be considered before finalising on the loan amount.

What Will Be the Tenure Of the Loan?

Depending on the relationship shared between the co-applicants, the tenure of the loan can vary. For example, the tenure can be extended up to 20-25 years if the co-applicant in Home Loan is a spouse or a brother. In case of a parent-child relationship where the repayment is majorly dependent on the parent’s income, the maximum loan tenure is linked to the parent’s retirement age. In most of the cases though, the tenure doesn’t extend beyond 10 years.

What are the Tax Benefits?

Home loans not only fund your urgent financial needs but also give you tax returns on your home loan interest and principal components. If you go for a joint home loan with your spouse in the ratio of 50:50, both of you can claim benefits separately.

What Will the Repayment Process Be Like?

It is up to the co-applicants of the home loan to decide how the repayment process will be like. They can opt for a joint bank account and transfer money to it monthly or either one of them can pay the EMIs. To manage your loan repayments better, calculate your EMI using Bajaj Finserv EMI Calculator.

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