Personal Loan Tips: These 5 charges are levied on personal loans, loan agents often try to hide them..

While taking a personal loan, you need to be aware of some fees. Understanding these fees can make financial planning easier for you and help you avoid unexpected expenses. Here are some special fees that should be kept in mind while taking a personal loan.

1- Processing Fee
This fee is charged by the bank or financial institution during the processing of the loan. It is usually 1% of the loan, which can be up to 3% and sometimes this amount can also be in the minimum limit.

2- Prepayment/Foreclosure Fee
If you repay the loan amount early i.e. before the pre-determined period, then some institutions charge a fee for this. This fee can usually be from 2% to 5% of the loan balance. In some banks, this fee is not fully applicable, especially if you have repaid part of the loan.

3- Late Payment Fees on EMI
If you do not pay your EMI on time, the bank or lender may charge a late fee. This fee is decided by the bank and it can vary depending on your EMI. This fee can usually be between ₹500 to ₹2000.

4- Check Bounce Fees
If you are paying the loan EMI through a cheque and the cheque bounces, the bank may charge you a bounce fee. This fee can range from ₹200 to ₹500. This also depends on your bank, you may be charged more.

5- Loan Insurance Fee
Some banks charge a fee for taking an insurance policy on a personal loan. Its purpose is to protect the loan amount from risk. This charge depends on the loan amount and the insurance policy.

Disclaimer: This content has been sourced and edited from ZEE Business Hindi. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.