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How to Get a Second Personal Loan?
How to Get a Second Personal Loan?

Personal loans are a great way to meet emergency financial needs. Whether it’s a medical emergency or a dream vacation or you want to buy your favorite gadget that you had been waiting for, personal loans have time and again proven to be the right way to fulfill such requirements. A personal loan may come easy, but you must remember that it all comes at a cost that one needs to repay them. An important question that people often ask while applying for a personal loan is, whether they can take the second loan while they are still payoff for the previous one? Let us analyze this.

Can I take out two personal loans at the same time?

It must not come as a surprise to you, but many lenders provide you a second loan once you pay off a part of initial balance and have a good credit history of on-time payments. But, it is not always a good idea.

The primary reason for this is that you might not get the best deal. Another probable cause for this could be that you might not get the best APR for the second loan. It is in the hands of the lender to decide how much can you borrow, and the APR and loan term is based on various factors such as debt-to-income ratio or DTI, credit score, etc. If you have taken a loan and apply again for another personal loan, there are chances that it may affect your credit score.

If you have recently taken the loan, then it increases the DTO which eventually affects the credit score thereby reducing the probability of getting another loan at competitive interest rates.

Don’t overborrow-

Another factor to consider whether or not to take the second personal loan is to understand the fact that you need to repay the loan. If you take two loans at a time, then it will increase the monthly EMIs thus increasing the pay off the burden.

Points to consider before applying for a second loan:

  • You may have a problem in future borrowing- Taking two personal loans at the same time may affect your future probability of getting the loan approved. You may have to face too many inquiries pertaining to the credit report.

  • It may affect your credit score adversely- Well, it may sound lucrative that you can get two personal loans simultaneously, but at the same time it also increases your monthly liability to pay off. In case of failure to repay the loan or missing on the EMIs may affect your credit score thereby reducing the probability of getting the loan approved in the future.

 

Key points to keep into consideration while applying for a personal loan:

If you are willing to apply for the second personal loan, then it’s imperative that you must keep certain points into account. Here are some points you cannot miss upon:

  • Make sure that you check the credit score and credit report before applying for the second personal loan. A poor credit score may negatively affect your loan approval probability.

  • Make sure you repay your EMIs on time. It is imperative that you should be repaying your EMIs on time, late payment or missing on the payments will affect your credit score and also reduces the chances of loan approval in the future.

  • Don’t go over the limit- While it may lure you that with the help of personal loan amount you can fulfill your financial needs but at the same time you should know that this loan comes at an interest rate which you need to pay every month. So the amount should be such that it doesn’t affect your financial stability and create a debt burden.

 

Conclusion- So, if you are hunting down for a personal loan lender, make sure that you don’t fall in the trap of lucrative offers, instead, consider all the factors mentioned above and then go ahead with the loan application.

 

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