4 Factors That Affect Your Doctor Loan Interest Rate

Even though the medical profession is considered among the most elite métiers in the country, most individuals with an MBBS or MD degree fail to secure substantial monthly income until quite later in their life. Establishing a solid career in the field of medicine requires investment, both in terms of time and money, and it is only after several years that individuals manage to build up enough savings to meet big-ticket expenses.

In such situations, a doctor loan can help medical practitioners meet expenses, both personal and professional. These comprise a suite of both secured and unsecured advances, each tailored to cater to various requirements. 

Now, while these credits are offered against competitive interest rates, borrowers can ensure a further reduction in them by being mindful of a few factors. Following is an elaboration on a few factors that can influence the interest rate for doctors loan alongside a few measures that borrowers can adopt to avail the lowest rates.

Credit score

Most lenders place particular emphasis on a borrower’s credit score while granting approval for their loan application. This score is a 3-digit numeric representation of one’s creditworthiness and is determined by a borrower’s repayment history, borrowing pattern, credit portfolio, etc. Usually, borrowers are encouraged to maintain a credit score of 750 or above to ensure easy approval of loan applications.

Credit score also holds a significant advantage when it comes to determining the interest rate for doctor loan. Those with a high score are usually considered as low-risk borrowers and consequently offered lower interest rates and favourable terms of borrowing. Individuals with a high credit score also stand a chance to negotiate with their lenders for lower interest rates. So, professionals may look for ways to increase their CIBIL score. 

Loan tenor

While opting for a longer tenor may result in a lower EMI out go to repay doctors loan India, it is advisable to always settle for a lower term. A shorter tenor translates to a lower interest outgo in the long run. Further, since the risk of lending is lower when a borrower opts for a shorter tenor, financial institutions are more likely to extend a marginally lower rate of interest.

Property type being mortgaged

When it comes to availing a loan against property for doctors, the interest rates are also influenced by the type of asset being mortgaged. For instance, the rates may vary for commercial and residential properties since these are valued differently. Further, the location of the property, its age, market valuation and such other factors are also considered when it comes to determining the interest rates.

Profile of the borrower

There are several factors that influence an individual’s eligibility to qualify for a loan for doctor. Among these, one’s experience in the medical field, alongside other factors like income, age, city of residence, etc., play a crucial role. The rate of interest offered also varies per these factors. For instance, professionals who are starting out with their career might be offered lower interest rates, as opposed to those who are nearing their age of retirement.

These are among the top four factors that influence the interest rates for doctor loan.

While being mindful of these factors is crucial when availing these credits, one must also factor in the parameters pertaining to how to be eligible for a doctor loan, the documents required, and other accompanying offers.

For instance, financial institutions like Bajaj Finserv extend pre-approved offers that can expedite the loan application process to quite an extent. These offers can also be availed on other financial products like business loans, personal loans, credit cards, etc. You can check your pre-approved offer by providing your name and contact number.

With these few factors into consideration, individuals can proceed to apply for a doctor loan to enjoy the following benefits – 

• Eligible borrowers can get a doctor loan of up to Rs.35 lakhs and Rs.50 lakh under a business loan and a loan against property, respectively, to finance any number of requirements.

• Individuals belonging to the medical profession can enjoy approval within 24 hours upon satisfying certain eligibility criteria.

• One can reap the benefits of the Flexi loan feature and utilise the amount they require from the total quantum sanctioned and pay interest only on that amount.

Thus, with the above-mentioned factors that influence interest rate for doctor loan in consideration, borrowers can avail of any of these secured and unsecured advances to undertake any big-ticket expenses without hassle.