Fees and charges are a part and parcel of any loan. When choosing one, they are important considerations apart from a competitive rate of interest, as they determine the total cost of your loan. Understanding these charges is crucial as it helps you gauge its affordability and plan for timely payment.
Take a look at the charges that you are likely to have to pay when you take a loan for doctors.
Processing fees
A processing fee, also known as an application fee, covers the costs associated with processing your loan application. The cost of verifying documents and resources is built into this charge. Typically, this fee ranges from 2.95% (Inclusive of applicable taxes), and it is usually deducted from the approved loan amount before it is disbursed to you.
Statement charges
It is a lender’s duty to provide you with statements such the principal and interest statements, but several financial institutions charge you a fee for providing you these details in the form of a hard copy. The fee covers charges incurred by the lender while delivering these hard copies to you. As a thumb rule, look for lenders who don’t levy this charge.
When you take a Loan for Doctors from Bajaj Finserv, you don’t have to pay any statement charges. You can simply log on to the secure Bajaj Experia customer portal with your username and password and access all statements and loan details online at your convenience.
EMI bounce charge
Just like a bounced cheque incurs a charge, a bounced EMI cheque attracts the same penalty. The average charge for a bounced EMI cheque is around Rs. 1,500 per bounce. So, while you should pick a lender with low charges, it is more important to ensure that you have the necessary means to pay your EMIs month on month. Maintaining a dedicated account will help you do this.
Penal interest
When you default on an EMI payment or the loan itself, you have to pay a penal interest. This is over and above the interest rate of the loan, which is the cost at which you receive funds from a lender. The penal interest that you have to pay is around 3.50% per month.
Foreclosure charges
Foreclosing a loan involves making a single payment to repay the loan before the tenor lapses. However, this can put the lender’s interests at risk. So, most lenders levy a foreclosure charge. This is around 4.72% Inclusive of applicable taxes, on the outstanding loan amount.
Prepayment charges
Prepayment is similar to foreclosure, as it involves making payments towards the principal to lower your balance EMIs.
Making prepayments affects the lender as well and so, you may have to pay a prepayment charge. When you take a loan from Bajaj Finserv, however, prepayment charges are either nil or low to help you clear your loan quicker. Understanding these charges will help you calculate your total outflow towards the loan more accurately, and be prepared when it is time to make payments.
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