April 14, 2024

Business Bib

Business & Finance Blog

Is there an ideal age to get your first personal loan

3 min read

During these times of increasing inflation, it comes as no surprise that finance owners worry about the right age to take personal loans. This becomes important because your age has much to do with the tenure of repayment, interest rates on personal loan etc, that you will be offered by the bank. If the tenure, it is longer can help you dodge the pressure of repaying fast and paying handsome amount for EMI every month. Additionally, there are a number of reasons for which you can consider taking a personal loan and some of these include, renovating your car, bike or home, taking a foreign trip, getting married in the manner that you dreamed of and so on. This article will inform you of the right age to take up a personal loan online and some of the benefits attached to taking loans at a proper age.

Basic criterion for eligibility

Before going for a personal loan, it is crucial that you educate yourself with the information of basic criterion of eligibility that banking and non-banking institutions take into consideration and some of them are as follows,

  • Your monthly income in adherence with the loan amount you have applied for.
  • Income after exclusion of existing EMI payments for previous loans.
  • Your age which determines the duration or the tenure wherein your loan can safely be continued for.
  • Your past records which allow banks an insight into the kind of finance handling you are able to do and whether or not you are regular and not a defaulter with your payments.

Importance of age in taking a loan

In taking a loan, one of the foremost things to understand is that your age plays quite an important role in loan approval. It is a factor that you compulsorily have to include in the personal loan emi calculator online to get an approximated tenure for the repayment scheme. It must be kept in mind that it is best to take up these loans at a younger age for there is a higher tenure available to pay these loans off. This is to say that most banking and non-banking institutions set the maximum loan tenure at twenty years and if you take one at the age of thirty, you will be allowed by the lending institution to stretch the duration out till the full length of the two decades. Such an option lessens the burden you have on your shoulders every month as a result of the less EMI you are expected to incur.

Why should you avoid taking a loan when older?

Not only is it more difficult to get a loan approved from bank when you are older than forty five, but there are also a number of factors that you should take into account before jumping into taking a loan at fifty. In most cases older people are not given longer tenures for repayment which means that the amount of money that you will be required to pay as monthly EMI can turn into quite a burden for you. Additionally, in case of emergencies it will not be easy for you to apply for extension of your tenure because of your advanced age.

Some benefits of taking loan at young age

In times of soaring inflation, having a small amount as monthly EMI for your instant personal loan, as a result of a longer tenure for repayment, is quite helpful. You can also extend your tenure till about a period of twenty five years if you see unforeseen expenses coming up which is making your existing EMI amount a burden. In addition, you can step up your repayment option wherein the initial EMI amount will be lower and will progressively increase with your age.