Personal Loan

What Is Personal Loan?

To cover their requirements, people would get unsecured loans from banks or non-banking financial institutions (NBFCs). It is based on essential factors, including income level, credit history, work history, payback ability, etc.

Why Need Personal Loans :

For Wedding

For Travel

For Education

For Festival Celebration

For Consumer Durables Products

For Medical Emergency

What Is Personal Loan Interest Rate?

The rate of interest starting from 10% to 15% annually. Interest rates differ from bank to bank. Additionally, it depends on the applicant's income level, credit history, current loans and EMIs, loan term, credit score, and other factors.

Benefits Of A Personal Loan

A few advantages of a personal loan are as follows:

No security or collateral is required

Since this loan is unsecured, no asset security is needed. It is given based on your credit history and ability to repay the loan.

Less documentation

Due to the extensive documentation requirements, many people detest applying for personal loans. Personal loans, however, require less paperwork to get accepted.

Flexible loan tenure of around 1-7 years

Loan terms for personal loans can range from one to Seven years, its depending bank to bank. Therefore, you are free to select your tenure by your re-payment plan. Getting a loan with a shorter term is best to reduce your interest costs.

Easy EMI facility is available

Equated Monthly Instalments simplify the loan concept. Personal loans also allow for simple EMI payments and assist you in repaying the principle throughout the loan.

It is a multipurpose loan

Personal loans, as opposed to house or auto loans, can finance practically any goal.

Age Limit

If you are a paid employee, your age range is between 21 and 58. A self-employed professional or businessperson must be between 25 and 65.

Monthly Income

Your monthly net income is essential to the approval of your loan. Some lending institutions may set a minimum monthly income requirement. In contrast, some banks have a monthly income requirement of Rs. 25,000.

Credit Score

This is the rating that a credit reporting agency has given you. It provides perspective on your borrowing history to a potential lending institution. You may also use a good credit score to your advantage when negotiating better loan conditions. Some banks need a CIBIL Score minimum of 700, while others want a minimum of 750. A rating between 700 to 900 is ideal.

Employment Term

Approval could be challenging if you recently changed jobs several times. As an illustration, many financial institutions grant loans to workers with at least two years of professional experience and at least one year in their present workplace. Professionals who work for themselves must have at least three years of experience. Some take into account your whole employment history.

Nature of Employment

Basic employment categories include professionals, self-employed people, and paid workers.

Documents Required For A Personal Loan

Some of the essential documents required for a Salaried Employees are below:

  • 1. Income Proof - salary certificate or salary slips last three months.
  • 2. Bank Statement - Last 3- or 6-months’ updated bank account statements
  • 3. Identity Proof - PAN card/ Aadhar card/ Passport/voter’s ID card or driving license.
  • 4. Address Proof – A copy of driving license/ utility bills/ bank statement / Aadhar card/Passport/Rent Agreement
  • 5. Employment Proof - Appointment letter/ contract / company’s / HR’s email ID or official identity card.
  • 6. Residence Ownership Proof - Property documents, maintenance bill and electricity bill of the residence.
  • 7. Photograph - Latest coloured passport-size photograph.