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Have you ever checked your loan app and seen terms like ‘activation pending’ or ‘active loan’ and wondered what they really mean? This is one of the most common doubts borrowers have once their loan gets approved. Is your loan already running, or is it still waiting for a final step before disbursal? 

The answer is simple yet important. Activating a loan is about completing final steps like eSign and setting up your eNACH mandate (UMRN) so the bank can release funds. An active loan means your money has already been disbursed and your repayment schedule is live. Understanding this difference saves you from confusion, helps you track EMIs better and keeps your credit score healthy. 

What is Active Loan Meaning? 

An active loan is any credit account that has been disbursed and is not yet fully repaid. It carries an outstanding balance, a live repayment schedule and a status of ‘Active’ or ‘Open’ in your credit report. Credit cards with a running balance count too. 

Your PAN is what ties this together. When you apply for any loan, the lender collects your PAN as part of KYC. Once disbursed, it reports that account to the credit bureaus against your PAN, and every repayment, missed EMI or closure updates the same PAN-linked profile. So when you want to know how to check active loan on my name, you are really asking how to read your credit report. 

DID YOU KNOW? 

Your PAN does not affect your credit score by itself. It is the identifier that lets the system compile your credit history in one place, which is why it is the fastest route to a full list of your loans. 

What Does ‘Activating a Loan’ Mean? 

When a lender approves your loan, you are not done yet. You must finish a few digital formalities before the money hits your account: 

1. eSign your loan agreement and Key Fact Statement (KFS) using Aadhaar OTP 

2. Set up your eNACH auto-debit mandate, which generates a UMRN confirming EMI auto-debits 

3. Once verified, your loan moves to the disbursal stage 

PRO TIP 

Always save the mandate confirmation SMS or UMRN number. It is your proof that the auto-debit is registered, and the first thing support will ask for if an EMI fails to debit. 

What Does It Mean if Your Loan is Active? 

An active loan means: 

4. Funds are already credited to your account 

5. EMIs are scheduled and repayment has begun 

6. Your lender app or statement shows the loan ID, due dates and outstanding balance 

7. Within a few days it also appears in your credit report at CIBIL, Experian, CRIF High Mark and Equifax 

Active status means full responsibility to pay on time, because this feeds directly into your credit history. 

How to Check Active Loan on PAN Card & Loan Status 

If you are wondering how to check loan status, there are four practical routes, and they answer slightly different questions. Use the lender’s own channels for repayment detail on one specific loan, and your credit report for the complete picture across every lender. 

Where to Check	What It Shows	Best For
Lender app or website	Dashboard, then loan details, then status: Active, Closed or Overdue	Checking how to know loan status on one specific loan, with exact EMI dates
Netbanking or mobile banking	Loan and credit account sections with outstanding balance	Bank loans where you already have netbanking access
Credit report by PAN	Every loan and card reported by any lender, with current status	A full list of your active loans, including any you have forgotten
Lender customer care or branch	Verbal or emailed confirmation of status and dues	Older loans not visible in an app, or disputed entries

The credit report route is the only one that shows loans across all lenders at once. If your question is how to check my loans in one place rather than one at a time, that is the one to use. 

How to Check Active Loan on PAN Card via CIBIL, Experian, Equifax & CRIF 

India has four bureaus licensed by the Reserve Bank of India: TransUnion CIBIL, Experian, Equifax and CRIF High Mark. Each must give you one free full credit report per calendar year, so you have four free checks. The flow is broadly the same: register with your PAN, verify by OTP, answer a security question, then open the accounts section. 

WATCH OUT 

Not every lender reports to all four bureaus. A loan visible on your CIBIL report can be missing from your Equifax report, and neither is wrong. If you are checking for a loan you did not take, check all four. 

1. CIBIL (TransUnion CIBIL) 

8. Go to cibil.com and open the free credit score section 

9. Register with your name, date of birth, PAN, mobile and email, then verify the OTP 

10. Answer the identity verification questions about your existing loans or cards 

11. Open the account information section, where each entry shows the lender, account type, sanctioned amount, current balance and status 

12. The downloaded PDF is password-protected; the site shows the password format at download 

Note that a CIBIL score is only generated if you have had an active loan or credit card reported in the last 36 months. First-time borrowers may see no report at all, which is normal. 

2. Experian 

13. Visit experian.in and select the free credit report option 

14. Enter your PAN, name, date of birth and mobile number, then verify the OTP 

15. Create your login and open the credit report 

16. Check the account summary for your number of active accounts, then the details of each 

3. Equifax 

17. Go to equifax.co.in and request your free annual credit report 

18. Submit your PAN and identity details and verify by OTP 

19. Download the report and review the accounts section for active and closed loans 

Equifax India scores run on a 1 to 999 scale rather than CIBIL’s 300 to 900, so do not compare the numbers directly. A 700 at Equifax is not a 700 at CIBIL. 

4. CRIF High Mark 

20. Open crifhighmark.com and go to the personal credit score section 

21. Register with your PAN, personal details and mobile number 

22. Complete OTP-based verification 

23. Access your score and download the full report to see your active loan accounts 

CRIF High Mark is worth checking if you have taken small-ticket, microfinance or cooperative bank loans. Its coverage of that segment is deeper, so a small loan missing elsewhere often shows up here. 

How to Check Active Loan on PAN Card Using Fintech Apps 

If you would rather not register at four separate bureau sites, several regulated fintech platforms pull bureau data into one dashboard. The trade-off is worth understanding first. 

• Multi-bureau aggregators show reports from more than one bureau in one app, usually refreshed monthly rather than annually 

• Your lender’s app may offer a free credit score check in its dashboard, convenient if you already bank there 

• Some payment and banking apps show a loan tile with status and upcoming repayment dates for loans taken through that platform, though availability varies and changes often 

• All of these are soft enquiries, so using them repeatedly does not damage your score 

Two cautions. Stick to platforms that name which bureau the data comes from, and be wary of any site charging for a ‘real’ credit report when the bureaus give you one free each year. Also check what you are consenting to, since some apps use the score check to generate loan offers. 

What to Do If You Find an Unauthorised Loan Linked to Your PAN 

A loan in your report that you never applied for usually points to identity misuse, though it can also be a data error where someone else’s account was tagged to your PAN. Either way act quickly, because it keeps affecting your score while it sits there. 

24. Download reports from all four bureaus to see whether the entry appears in more than one 

25. Raise a dispute on the bureau’s portal against that loan account number, marking it ‘not mine’ and uploading any proof 

26. Write to the lender named in the entry, ask for the loan application documents and state clearly that you did not apply 

27. File a complaint at cybercrime.gov.in if it looks like identity fraud, and keep the acknowledgement number 

28. Escalate to the lender’s nodal officer, then the RBI Ombudsman via cms.rbi.org.in if unresolved after 30 days 

29. Pull a fresh report after the next reporting cycle to confirm the entry is actually gone 

QUICK STAT 

Bureaus and lenders must resolve a credit report dispute within 30 calendar days. Beyond that, you are entitled to compensation of ₹100 for each day of delay, and lenders must supply the bureau with the information it asks for within 21 days.  (Source: RBI circular RBI/2023-24/72, effective 26 April 2024) 

Keep every ticket number and email. Disputes stall when the bureau has raised the query but the lender has not pushed the corrected record, and a paper trail is what gets it moving. 

Common Issues You May Face 

Two problems come up far more often than the rest: 

• Activation stuck or on hold: usually a failed eNACH registration, Aadhaar name mismatch or bank downtime. Retry the mandate setup or contact your lender 

• Loan shows ‘active’ even after closure: systems lag behind reality. Request your No Objection Certificate (NOC) and updated Statement of Account (SoA) from the lender, then raise a correction with the bureau 

Timing has improved on that second point. Lenders now report to bureaus every 15 days rather than monthly, typically around the 15th and month end, so a closure should reflect within a fortnight. Still showing as active a month later is a genuine error worth disputing rather than waiting out. 

How Active Loans Affect Your Credit Score? 

Your CIBIL score is directly linked to your loan status: 

• Timely EMI payments improve your credit score 

• Missed or delayed EMIs lower your score and may attract penalties 

• Closed loans with an NOC strengthen your profile and show repayment discipline 

The fortnightly cycle cuts both ways. Good repayment shows up faster than it used to, but so does a missed EMI, now flagged within 15 days instead of up to 45. If money is tight, talking to your lender before the due date beats letting the debit fail. 

Knowing whether your loan is still activating or already active saves you from confusion, missed EMIs and credit score issues. Finish your eSign and eNACH steps quickly, then check your loan status across your lender’s app and your bureau reports once or twice a year. 

If you need cash instantly, then Fibe is here for you! Get up to ₹10 lakhs in just a few minutes directly in your bank account. Got a surplus amount? Repay the loan early with 0 foreclosure charges. Download the Fibe App to apply. 

FAQs on Active Loan Meaning & How to Check Active Loan on PAN Card 

1.What does it mean if your loan is active? 

An active loan means your approved loan has been disbursed and is currently running. You are now responsible for repaying the EMIs as per the schedule. 

2.Does an active loan affect CIBIL score? 

Yes, an active loan impacts your CIBIL score. Timely EMI payments can improve your score, while missed or delayed payments can negatively affect it. 

3.How do I check active loan on PAN card for free? 

Each of the four credit bureaus must give you one free full credit report per calendar year, so you get four free checks. Register at cibil.com, experian.in, equifax.co.in or crifhighmark.com with your PAN, verify by OTP and open the accounts section. Be cautious of sites charging for a report the bureau gives you free. 

4.How can I check how many loans are linked to my PAN card? 

Your credit report lists every loan and credit card reported against your PAN, with the status of each, and the account summary near the start gives you the count of active and closed accounts. Because not all lenders report to all four bureaus, pulling more than one report gives the most complete count. 

5.Can checking active loans on my PAN card affect my credit score? 

No. Checking your own credit report is a soft enquiry and has no effect on your score. Only hard enquiries, when a lender pulls your report because you applied for credit, can affect it. Check your own report as often as you like. 

6.How do I check my loan status using my lender’s app? 

Log in to the lender’s app, open the dashboard and go to loan details, where the status appears as Active, Closed or Overdue along with your loan ID, EMI due date and outstanding balance. This is the quickest answer to how to check my loan details for one specific loan, though it will not show loans from other lenders. 

Knowing when to take out a personal loan isn’t easy, but there are instances where these loans can help. For one, these loans are a great option for dealing with emergencies, as you get funds quickly.  

You can also use the loan amount to streamline existing debt repayments, build your credit score, or save on high-interest rates. So, technically, a good time or right time to take a loan is whenever you need the funds.

For insights on when applying for a personal loan can be a wise option, things to consider and more, read on.

The right moment to avail of a loan completely depends on your need and personal finances. However, the right loan from a reputed lender also makes this decision a lot easier. One option to consider is the Fibe Instant Cash Loan, as you can get up to ₹5 lakhs with ease and on affordable terms. 

Here, you can choose from flexible tenure of up to 36 months for easy repayment all through. Fibe Personal Loan has no end-use restriction, straightforward eligibility criteria, a convenient application process and zero hidden fees. So, download our Personal Loan App or go to our website to apply now. 

FAQs on When to Avail a Personal Loan

What is the right time to take a personal loan?

Knowing when to take out a personal loan can be tricky because it completely depends on your financial needs.  As it is a flexible option, you can use it for almost any expense. Ideally, you can consider availing a personal loan for: 

• Debt consolidation 
• Overseas travel
• Higher education tuition costs
• Wedding expenses
• Down payments
• Big-ticket purchases

Do personal loans affect mortgage applications? This is a smart question and the simple answer is yes. Even though one is unsecured and the other is secured, any existing loan affects your second loan.

Your existing personal loan can have a significant impact on everything from eligibility to interest rates. Read on to get an answer to the question, will getting a personal loan affect getting a mortgage?

Positive Effect of Personal Loans on Home Loan Applications 

Here’s how it affects your application positively:

• Helps Build a Positive Credit History

If you’ve repaid your personal loan successfully, it creates a good payment record. Responsible repayment behaviour includes:

1. Timely repayment of your personal loan EMIs
2. No defaults or loan settlements

When you apply for a mortgage, lenders check how well you handle credit. A positive repayment track sends the right message and you can look forward to quick approval.

• Reflects Solid Financial Standing

When you repay your personal loan on time, it speaks volumes about your income and employment. Both these aspects are considered when lenders are assessing your second loan application. 

• Helps You Negotiate for Better Loan Terms

If your existing personal loan repayment record is positive, you are a creditworthy borrower. Thus, you have the power to negotiate for better loan terms.

This way, you can contact the home loan lender and communicate your case for better terms. You can negotiate for the following:

1. Lower interest rate for the home loan
2. An extended tenure for the home loan

Negative Effect of Personal Loans on Home Loan Applications

In some cases, this can be harmful:

• Non-Repayments Lower Your Credit Score

Your credit score summarises your repayment history. Lenders rely on this number to check your credibility and eligibility. Your credit score decreases when you fail to repay your personal loan EMIs as per the pre-decided schedule.

Home loan lenders may hesitate to approve your application when they see that you don’t have an adequate score.

• Affects Your Debt-to-Income Ratio

This ratio determines the amount that goes towards repaying your existing debt from your total monthly income. This may be due to a:

1. Personal loan
2. Auto loan
3. Credit card 

A higher DTI ratio reflects a high dependence on credit. This may lead to lenders assuming that you don’t have room for a second loan and they may not approve your home loan application.

• Results in Hard Inquiries by the Lender

Your credit report is generated by credit bureaus like:

• TransUnion CIBIL
• Experian
• CRIF High Mark
• Equifax

Your credit report is based on:

• Each minimum payment you make towards your credit card bill
• The monthly EMI amount on any vehicle loans
• Any judgments or liens against you
• Each EMI amount towards your personal loan
• Additional financial obligations

When you apply for a home loan, the lender will initiate a hard inquiry of your score, which gets recorded in your credit report. Multiple inquiries can hurt your overall financial profile and lead to lenders rejecting your loan application.

• Incurs Higher Interest Rates

A solid financial profile includes:

• Stable income and employment
• High credit score
• Consistent repayment of your credit
• Low debt-to-income ratio

If you don’t have these, you may not appear to be a creditworthy applicant. This increases the default risk and lenders compensate with a higher interest. 

Now that you understand how a personal loan can impact your mortgage, you can plan your application wisely. To ensure you have the freedom to prepay and have minimum hoops to jump through, consider getting an Instant cash Loan of up to ₹5 lakhs from Fibe.

You can get the funding at competitive interest rates and repay easily by choosing from flexible plans. What’s more, you can get the funding online with minimal formalities. Download our Personal Loan App or apply directly via our website. 

FAQs on How Personal Loans Affect Getting A Mortgage

Can I get a home loan if I already have a personal loan?

Yes, there is no restriction on the same, even if you have a personal loan.

Will a personal loan affect my mortgage application?

Yes, here’s how it affects your second loan positively:

• It helps build a positive credit history
• It assists in debt consolidation
• It reflects a solid financial standing
• It helps you negotiate for better loan terms

It affects your home loan negatively in some cases when:

• It results in hard inquiries by the lender
• It can lead to higher interest rates
• Non-repayment of your personal loan lowers your credit score
• It affects your debt-to-income ratio

Do personal loans affect home loan eligibility in India?

Yes, it can influence your eligibility in these ways:

• Positively, when you pay your personal loan successfully on time
• Negatively, when you fail to repay your loan as per the schedule

Before you plan on getting credit, you must ask the question, ‘Are personal loan rates going up or down?’. This is because interest rates significantly affect your overall borrowing cost. With an increase in the rates, your repayment amount will also go up and vice versa. 

These interest rates depend on several factors, from your financial profile and the policies of the lending institution to the market rates. Read on to learn how high rates affect your borrowing and what causes an increase in rates.

How High Interest Rates Affect Borrowers?

• In India, the Reserve Bank of India (RBI) levies an interest charge, known as the repo rate, on the funds that commercial banks borrow.
• With an increase in the repo rates, interest rates levied by the lenders also rise, increasing the borrowing cost of your loan.
• Conversely, a decrease in the repo rates can result in your loan EMI also going down.
• If you have chosen a floating rate, any change in the repo rate will affect your rate too.
• On the other hand, if you have chosen a fixed rate, the EMI will remain the same throughout the tenure.
• If you choose floating interest rates, you must check if there’s a cap on the maximum increase in these rates and your EMI amount.

Also Read: Why Personal Loan Interest Rate is High?

Factors that Lead to an Increase in Personal Loan Interest Rates

Here are some of the factors that could increase the interest rates offered to you:

Monthly Income

• Lenders check whether you have a stable monthly income or not before approving your application 
• With this information, they assess if you’ll be able to repay the loan comfortably
• In addition to deciding whether to approve your application, they consider your income to decide the interest rate as well
• If they believe that repaying the loan with your income may be difficult, they may charge a higher interest rate to compensate for their risk 
• On the other hand, if your income is on the higher end and can support timely repayment, they may offer lower rates due to the reduced risk

Nature of Employment 

• In addition to your monthly income, lenders also consider your employment status
• For this, they evaluate:

1. Whether you are a salaried employee or a self-employed individual
2. Your work experience (employment history) in your current organisation
3. The reputation of the organisation you’re currently working in
4. The age of the business you’re currently operating
5. Whether your business has stable or seasonal income

• With this information, lenders decide if your employment is stable enough to support your loan repayment 
• If it is, they may offer you loans at lower rates since the risk of default is low and vice versa.

Credit Score

• When you apply, the lending institution checks this score to assess your repayment capacity
• A lower credit score indicates that you are either inexperienced or have had a poor track record when it comes to credit
• Lenders may charge a higher rate if you apply with a lower score to compensate for their risk
• If it is on the higher side, it shows that you have a stable financial profile and are a responsible borrower
• This leads to a reduction in the risk for the lender and they may offer loans at lower rates

Age 

• Lenders take this factor into account to gauge your repayment ability 
• For younger individuals who have just entered the job market, lenders may assume that you don’t have enough employment history and don’t have experience with credit 
• In addition to that, if you’re close to retirement, your income flow may be disrupted 
• In these cases, the risk of default can be higher, leading to lenders offering a higher rate. 

Relationship with the Bank

• Lenders may charge a lower interest rate if you’re an existing or a past customer with an account in good standing
• In case you are, they may view you as a trustworthy borrower, who is less likely to default
• Based on this positive relationship, they may offer you a lower rate and vice-versa 

Availability of Collateral

• If you opt for unsecured loans, the lender may charge a higher rate for the increased risk
• If you’re pledging collateral, lenders may offer you a comparatively lower rate
• The asset you pledge as security strengthens your application and lowers the lender’s risk
• If you fail to pay your loan on time, the lender can legally recover the amount through your collateral
• Some assets you can offer as collateral include:

1. Gold 
2. Real estate
3. Investments
4. Vehicles
5. Inventory
6. Accounts receivable

Existing Liabilities

• Your existing financial liabilities also influence the interest rates. These liabilities include:
  • Loans
  • Credit cards
  • Monthly payments
• If you have a lot of expenses, lenders may assume that repayment may be challenging and you may default in the future
• To compensate for this risk, they apply a higher interest rate on your loan

Choosing a personal loan lender that offers competitive rates is a great way to keep your borrowing cost low. Fibe offers  Instant cash Loans of up to ₹5 lakhs at rates starting at 2% per month with tenure options of up to 36 months. You also don’t have to worry about hidden costs or pay any foreclosure charges that can drive up your borrowing cost. Download our Personal Loan App or apply directly through our website with minimal requirements.

FAQs on What Rising Personal Loan Rates Mean For Borrowers

Are interest rates for loans going up?

The answer to the question, ‘Will personal loan interest rates rise?’ depends on various factors, such as:

• Changes in the repo rates
• Your financial profile
• Rules and policies of the lending institution

What happens to borrowers when interest rates rise?

In such a scenario, the interest you pay on the loan will also increase. This can result in increased overall borrowing costs. However, the change in rates will affect your borrowing if you have floating rates and not if you have fixed rates.

Understanding the benefits, features and function of a personal loan vs a line of credit is crucial. Although these borrowing options sound quite similar to each other, they have some major differences. By knowing what they offer and how they differ, you can choose the best option to meet your needs.

Read on to learn what these options mean and how they differ.

Understanding Personal Loans

This is a type of credit where you receive the amount approved by the financial institution in a lump sum. These loans come with no restriction on end use, meaning you can cover a number of expenses, such as:

• Down payments 
• Payment of your children’s school fees
• Medical bills
• Renovation of your home
• Your child’s wedding

Lenders approve your application for these loans based on your:

• Income and employment
• Age and residence
• Credit history and score
• Credit utilisation ratio
• Debt-to-income ratio

Here are some benefits of a personal loan:

• No restriction on end-use
• No collateral requirements
• Funds are disbursed in a lump sum
• Interest rates and EMIs remain fixed throughout the tenure

With its myriad of benefits, personal loan also have some limitations, such as:

• Interest rates and other charges can be higher than other forms of credit 
• Interest owed is calculated on the total loan amount, even if you don’t use all of it

Understanding a Line of Credit

This option works similarly to credit cards, where you receive a fixed limit that you can withdraw funds from and use for specific purposes only. The lender will charge interest on the amount you use and the repayment can be in fixed instalments, interest-only, or any other option as agreed. 

Some line of credit options you can apply for include: 

• Personal line of credit
• Business line of credit
• Home equity line of credit (HELOC)

Here are some pros of a line of credit:

• You can withdraw the funds whenever needed
• Interest is applicable only on the amount that you use
• You can make repayments in various ways

Some limitations of a line of credit include:

• You need a high credit score to apply
• The interest rates are not fixed, which makes planning the repayment difficult
• This credit option can lead to overspending

Difference Between a Line of Credit and a Loan

Refer to this table to know how both these credit options differ:

Personal Loan Vs Line of Credit
	Personal Loan	Line of Credit
Disbursal of funds	The full sanction is disbursed to an account of your choosing	You can withdraw funds up to the approved limit as and when required
Purpose	Funding comes with no restriction on end use, which means you can use the amount for your various needs	You can only use the funds only for the specific purpose that you apply for, like a student line of credit or a business line of credit
Charges	Fees and charges include:Interest rateApplication feesLate payment chargesPrepayment charges	Fees and charges include:Interest rateAnnual feesLate payment chargesOverdraft fees
Interest calculation	Interest accrues on the total loan amount from the day you receive it	Interest accrues only on the amount that you utilise, not the entire limit
Repayment tenure	Generally, goes up to 60 months but can be higher depending on the lender	Depends on your usage and other factors, including the financial institution you choose
Type of interest rate	A loan can have fixed as well as variable interest rates	A line of credit can have only variable interest rates

Armed with this information, choosing the right option is a lot easier. If you decide that a personal loan is more suitable, consider getting an Instant cash Loan from Fibe. You can get up to ₹5 lakhs at competitive rates and flexible tenure. 

The process is also simple as you need only submit basic documents online and can get access to funds in a matter of minutes. Download our Instant Loan App or apply directly through our website. 

FAQs on Personal Loan vs Line of Credit

Is a credit line the same as a personal loan?

No, here’s how these credit options differ:

• Through a personal loan, you receive the amount in a lump sum and you can address numerous expenses 
• In a line of credit, you get a limit from which you can withdraw whenever needed only for the purpose you apply for, like a student or business line of credit 

What is the difference between a loan and a line of credit?

Here’s how a personal loan and a credit line differ:

• You receive a loan in a lump sum, whereas a credit line comes with ongoing access
• You can use a personal loan for various expenses, while you can only use a credit line for specific purposes
• Personal loans can have fixed or variable rates, while credit lines come with variable rates
• The interest is calculated on the full amount for a loan, while interest for a line of credit is based only on the amount that you withdraw.

While financial planning and discipline can help you stay on track to repay your debt, unwarranted expenses can derail any plan. Here, personal loan insurance serves as a safeguard from the risks arising due to such circumstances.  

A loan insurance policy covers the monthly repayment and protects you from default. You can make the right decision after assessing the cost of these policies. For answers to questions such as, ‘What is personal loan insurance?’, ‘Do I need personal loan insurance?’ and others, read on.

What is Personal Loan Insurance? 

• A personal loan protection or insurance policy assists you in repayment up to a certain period in the case of unforeseen circumstances.
• This financial product covers the burden of loan repayment in the event of job loss, critical illness, disability or death. 
• The insurance companies decide the amount of premiums based on the coverage, loan amount, employment status and health status.
• Since additional protection on your loan is not mandatory, the decision to buy insurance is entirely yours.

How Does Personal Loan Insurance Work?

Here is a quick snapshot of how it works:

• Depending on the insurance company and the type of policy, you can get short-term protection ranging from 12 to 24 months. 
• Generally, an insurance company pays off your debt obligations after 30 to 90 days of continuous unemployment or inability to repay.

What are the Different Types of Personal Loan Protections?

Personal loan insurance policies can be classified into two categories based on their features. See the table for the details:

Standard Loan Protection	Age-Related Loan Protection
Most lenders in India offer this facility.	You can get this type of insurance policy with only a few companies in India.
Premiums don’t depend on your age or occupation.	The premium amount depends on your age and the desired coverage.
Policyholders can choose from a flexible maturity period.	The maximum coverage offered by these policies extends up to 12 months only.
It includes an initial exclusion period of 60 days.	It doesn’t have an exclusion period.

Also Read: Impact of GST on Personal Loans

Should You Get Personal Loan Insurance?

Before opting for this financial product, consider the following reasons:

Security and Financial Assistance

• If unwarranted expenses arise and you find yourself unable to repay your obligations, personal loan insurance policies cover this cost to avoid default.
• In the case of the death of the policyholder, these products relieve the family from the burden of paying EMIs.

Money-back Facility

• Certain loan insurance policies provide returns at regular intervals or a lump sum amount at the end of the plan.
• These returns can be guaranteed or depend on the investment performance or a combination of both.

Things to Consider When Opting for Personal Loan Insurance

Before choosing this financial product, take these aspects into account: 

• Review the total cost rather than the monthly premium when buying an insurance policy against a personal loan.
• Read the terms and agreement of the policy carefully to understand the coverage clearly.
• Check if the insurance company allows you to claim coverage online.
• Review the company’s claim settlement ratio to evaluate its reliability. 
• Verify if the insurance company requires you to make an upfront payment or charges you monthly for premiums.

Personal loan insurance helps secure your and your family’s future when you avail of a loan. However, you should prioritise proper financial management, so that you can pay your EMIs in full and on time. A smart strategy would be to opt for a personal loan at affordable interest rates.

At Fibe, you can get an Instant Cash Loan of up to ₹5 lakhs at competitive interest rates and flexible repayment tenure options. Its online application process ensures that you can get funds online with minimal paperwork. Download the Fibe Personal Loan App or log in to our website to apply for loans and get approval within minutes!

FAQs on Personal Loan Insurance 

Is taking insurance on a personal loan good?

While this isn’t mandatory, here are a few benefits that you need to be aware of:

• It secures you from loan default by covering the cost of monthly repayment in case of unforeseen circumstances.
• You may also get a money-back facility where the insurance company provides a certain amount at the plan’s maturity.

What is the meaning of insurance on a personal loan?

It is a financial product that covers monthly repayment of a personal loan when you aren’t able to manage EMIs in the following situations:

• Job loss
• Disability
• Death

Is personal loan insurance refundable?

Some policies come with a money-back option, where you get a certain amount at the end of the plan. However, getting the entire sum wouldn’t be possible.

Getting a personal loan and a home loan at the same time is possible to manage your requirements. Whether you want to purchase your dream home or renovate your existing one, you can do it easily. All you have to do is get a personal loan after a home loan to extend your budget. 

Now that you have an answer to your question, ‘Can I take a personal loan after a home loan,’ here are a few easy-to-follow strategies you can follow.

Tips to Get a Personal Loan and a Home Loan Together

Follow these ways and get a personal loan and a home loan simultaneously:

Maintain a High Credit Score

The reason why lenders hesitate to approve your second loan application is due to the risk of default. However, a sure-shot way to tackle this is by maintaining an excellent credit score. Wondering what a credit score is? Simply put, it’s a 3-digit numerical summary of your credit behaviour. 

A higher score indicates creditworthiness and implies that you are a responsible borrower. This allows you to get hassle-free approval. Your score is calculated based on the following parameters:

• Your past repayment behaviour
• Your existing and past credit accounts
• Inquiries into your credit history
• Duration of your existing and past credit accounts

In addition to your credit score, lenders also consider these factors:

• Your age and residence
• Your income and employment
• Your credit utilisation ratio
• Your debt-to-income ratio
• Your collateral, if applicable

Assess Your Finances and Requirements

While it’s possible to opt for a second loan, remember that it can be quite taxing on your finances. This is because you need to repay two loans instead of one.

In simple words, you need to pay two sets of EMIs every month, which can be difficult to handle. But you can manage them by following these tips: 

• Assess your income from all the sources and your financial standing
• Avoid a second loan if your DTI (Debt-to-Income) ratio is high
• Opt for terms that you can afford to repay

Apply with a Co-Applicant or a Guarantor

Another smart strategy is to add a co-applicant or a guarantor. This helps you get easy approval; however, make sure the co-applicant has an excellent score. In case you fail to repay the loan, your loan will be repaid by the guarantor or co-applicant.

The chances of approval on your second loan increase significantly as the risk for the lender reduces. Ensure that these individuals possess the following:

• A favourable credit report and a high credit score
• No history of defaults for loans or credit cards
• A stable income and employment
• A low credit utilisation ratio
• A low debt-to-income ratio

Also Read: What Is a Co-Application for a Loan

Choose a Suitable Repayment Tenure

The tenure plays a critical factor when applying for any type of credit. This is because it helps you manage loan repayment seamlessly. Another reason is that the timeline you choose influences the EMI you need to pay.

While selecting a suitable tenure, consider the following parameters:

• Assess your monthly expenses to check your affordability
• Opt for a shorter tenure if you wish to repay your loan earlier
• If you want to pay smaller EMI amounts, a longer tenure is ideal

Keep Your DTI Ratio Low

What is DTI? Simply put, this is your Debt-to-Income ratio, which is an indication of your debts in relation to the total income you earn. Maintaining a low debt-to-income ratio can be helpful when opting for a second loan. 

Here’s a quick gist of what you need to know about DTI:

• A low DTI ratio shows a strong financial standing since the amount you spend towards your debt repayments is lower. 
• A DTI ratio of less than 35% is considered ideal, and the chances of approval on your loan applications are better.

When is Getting a Personal Loan and a Home Loan Together Ideal?

With an answer to the question, ‘Can I take a home loan and a personal loan simultaneously,’ you can make the right choice considering the pros and cons. Here are a few instances when it’s a smart decision:

• If you need funds to make a down payment for your home
• If you require additional funds to renovate your existing home

Planning your loan application process properly and choosing the right lender is important to protect your financial health. One such lender to rely on for an Instant Loan is Fibe. We offer up to ₹5 lakhs at affordable rates. You can get the required funding with flexible repayment plans and no hidden costs. Get started by simply downloading our Instant Loan App or applying directly through our website to apply for a loan today. 

FAQs on Availing a Personal Loan and Home Loan Simultaneously

Can a person have two loans at the same time?

Yes, there are no restrictions on getting more than one form of credit simultaneously. However, ensure the following parameters:

• Maintaining a spotless credit history
• Being able to manage the repayment effortlessly

Can you get a personal loan if you already have a home loan?

Yes, it is possible to apply a personal loan, even if you’ve applied for a home loan. At Fibe, you get to enjoy the following benefits when you opt for a personal loan:

• Ample funding of up to ₹5 lakhs
• Affordable rates
• Flexible repayment options
• Minimal documentation 

Does personal loan impact home loan?

No, getting a personal loan doesn’t impact your existing housing loan directly. However, if you don’t manage repayment properly, getting another loan can increase your financial burden.