Loan stacking or taking on multiple loans is considered to be detrimental to your financial health. This is because each loan comes with a specific rate of interest, as well as terms and conditions that vary from one loan to the next. So, by taking multiple debts you are not only complicating the borrowing process, but are also likely to spend a hefty sum on repayment every month. Thus, instead of taking many loans from various lenders, it is best to approach your existing lender.
Take a look at the benefits of borrowing multiple loans from your existing lender.
1. You can unlock better offers based on your past repayment
When applying for another loan, approach your existing lender for funds first. If you have maintained a good repayment record with this lender, it is likely that you will get another loan to meet your additional needs, easily and quickly. Moreover, you may be able to access additional benefits that a lender only offers to past or existing borrowers.
For example, if you already have a Business Loan with Bajaj Finserv, you can avail of a Personal Loan from them at a competitive rate of interest.
Apart from a substantial amount of up to Rs. 40 lakh, you can choose to avail of the loan on the unique Flexi Loan facility. This allows you to withdraw funds from your total sanction in parts, as per your needs, and pay interest only on the amount you use. Moreover, you can choose to repay interest-only EMIs all along with the tenor. This will reduce your EMIs by up to 45% and make repayment easier for you. In this case, you will have to pay the principal at the end of the tenor.
If you have higher loan requirements, you can choose to opt for a Loan Against Securities offering up to Rs. 10 crore or a Loan Against Property or Home Loan offering funds up to Rs. 2 crore.
2. You do not have to go through an exhaustive application process
Your existing lender already has all the information needed to grant you a loan. A docket will contain your identity, income details, your credit history and your loan repayment details too. So, whenever you choose to apply for a new loan with the same lender, you won’t have to spend hours on paperwork and copies of your ID and address proofs as most of your details are already on record.
On the other hand, when you apply for a second loan with a new lender, you will have to first meet the loan eligibility criteria and then submit a detailed application form, complete all the paperwork and attach the necessary documents. Taking a second loan from your existing lender is easier and hassle-free.
Bajaj Finserv provides special pre-approved offers to existing customers to help you fulfil your financial needs without any queues, details or forms needed. You can avail funds instantly with just 1-step verification. Click here to check your pre-approved offer.
3. You can manage your cash flow better
It is always a good idea to take a combination of loans from your existing lender. This is because it lowers your total EMI obligation and keeps your funds free for other purposes. Consider this situation: you have taken a business loan to expand your practice or firm’s reach. Now, owing to a wedding in the family, you need more funds. You can use your home as collateral and get a secured loan from your existing lender. By doing this, you benefit in many ways.
Additional Read: What are the Fees and Charges Applicable on your Personal Loan?
As an existing customer with a good repayment record, you will easily get a sanction on affordable terms. On the other hand, pledging a high-value property will help you get a high sanction with a convenient tenor and a nominal rate of interest. Also, since you have a relationship with the lender, you will be able to negotiate a better repayment schedule-one that helps you manage your cash flow more easily.
So, it is evident that approaching your existing lender with your new financial requirements is beneficial. You can negotiate better terms based on your credit score and repayment history, and borrow funds as per your needs, at a competitive rate of interest. Streamlining the process will allow you to make timely repayments towards both loans and maintain your credit score too.
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