New Delhi, Aug. 28 -- Personal loans provide quick financial solutions, but they often come bundled with hidden costs that inflate their true expense. Prudent borrowers must recognise these simple traps to avoid unexpected financial complications.

Before going ahead with any particular personal loan product, you should carefully understand the intricacies of the loan product, i.e., terms, interest rates, repayment tenures, and flexibility related to the product, before applying for it.

Let's break down the five most common traps that make personal loans heavier on the pocket than expected, and how to steer clear of them.

The processing fees of personal loans are generally between 0.5% and 3% of the total loan amount. This sum is deduct...