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Factors to be considered before going in for a CA Loan

Have you completed CA and have considerable years of practise and looking to set up your own business? Or you want to construct or purchase a house or renovate it? Whatever be the financial needs of Chartered Accountants in India they can be met with the help of CA loan offered by NBFCs. However, the lender might scrutinise several aspects before approving loans for the CAs. Some of them are:

FOIR

The Fixed Obligation to Income Ratio should not exceed more than 40%. Otherwise they will find it difficult to repay the EMI.

Liabilities

The total existing debts or other liabilities of the CA will be taken into account as too many debts will drain your income and you will find it difficult to repay the loan.

Repayment History

The lender will also check whether the CAs have repaid their dues within the stipulated time. Any default in the repayment of your debt or credit card bills will give you negative impression.

Repayment Capability

The lenders will also check your personal and professional overhead expenses, credit card debts, existing loans, etc. and how you repay them. They will check as to whether you can repay the debt within the given time.

Remember one thing that it is not advisable to go for a loan that does not serve your purpose or comes with high EMI as this will drain your savings or income. You should also check the interest rate and the repayment tenure. Keeping all these in mind, you should go for the CA loan.

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