A personal loan is of the options available in case of a sudden pressing financial requirement. Here, I am going to share certain pointers you should keep in mind before taking a personal loan to best fulfil your needs.

1. Consider other financing options: Secured loans such loan as against asset or gold are always cheaper; unlike unsecured personal loans. Hence, if possible it is wise to examine that option before taking up a high interest unsecured personal loan.

2. Compare various market players, products and its features such as rate of interest, EMI, processing charges, prepayment penalty etc. from online portals or local agents.

3. Be aware of your credit worthiness and maintain a good record of all liabilities. Almost all lenders look at the applicant's credit record before granting a personal loan.

4. Don't over shop for the loan as credit reports check your enquiry foot print. Too many loan applications bring down your credit score.

5. Choose the loan amount, EMI, type of interest rate and loan tenure carefully: A cardinal rule is 'Don't borrow more than you can repay'. Also, keep the tenure as short as possible as interest out-go are very high in the long term.

6. Organise requisite documents and keep them ready to speed up sanction.

7. Read and understand the fine print: Read the loan document carefully before taking the loan. Ensure that the terms and conditions match with those agreed upon while taking the loan.

8. Use the money productively: Since the interest rates of personal loans are high, always undertake a cost benefit analysis. Take a personal loan if you really need it or if it is being used to generate income that will help you repay the loan and interest.