A personal loan is an unsecured loan that comes to you without having to submit any collateral for the same. It can be given for numerous purposes such as marriage, education, medical emergency, travel, home renovation, etc. Both salaried and self-employed can apply for a personal loan. The loan comes with attractive interest rates and flexible repayment options. You can either apply online or at the branch of the bank or non-banking finance company (NBFC). You will also need to pay the processing fee at applicable rates. The lender will assess the loan eligibility based on your income, credit score and repayment potential.
Highlights of Personal Loans
Personal loans come with the following features and benefits that make one opt for the same. Let’s take a look at them.
Instant Loan Approval & Disbursal – The loan can be approved instantly provided you have the required income, desired credit score and repayment capacity as sought by lenders. Once the instant personal loan approval happens, the next course of action is sanction. The lender, after assessing your income and credit profile, sanctions a loan amount and communicates the same via an email or SMS. After sanction, the process of disbursal begins and you get the loan amount credited to your account within a few hours from the sanction.
Greater Loan Amounts – Times have changed and so have the personal loan offerings of banks and non-banking finance companies (NBFCs). There was a time when the maximum personal loan used to be around INR 15 lakh-25 lakh. That cap is now raised INR 40 lakh and even more. HDFC Bank, for example, has no maximum limit on a personal loan. If your income, credit score and repayment capacity are good and high, there’s no limit to the loan amount offered.
Flexible Repayment Tenures – The best part about a personal loan is that you are given time to repay the dues. You will get a loan tenure ranging from 1 to 5 years.
Attractive Interest Rates – Personal loans are available at attractive interest rates starting from 9.85% per annum. As the cost of funds for banks has come down rapidly, the rate of personal loan interest rates has also come down like secured loans.
No Collateral/Security Required – You won’t need to submit any collateral or security to get a personal loan, which is unsecured in nature. As a result, the loan sanction and disbursal depend firmly on your income and credit score.
Use the Personal Loan the Way You Want – The loan amount disbursed can be used by the borrower in the way he/she wants. You can get the loan for numerous purposes such as marriage, travel, home renovation, etc.
How to Grab the Best Personal Loan Deal?
The best personal loan should have the following features –
Attractive Interest Rates – The rate of interest determines greatly the cost of your borrowing. Although personal loan rates are greater in comparison to other loans, you can still compare the rates of different lenders and find the least one. Lenders set interest rates based on your income, organization, credit score, etc.
Low Processing Fee – Search for the lender that charges you less processing fees on a personal loan. A lower fee ensures the disbursal amount is not much lower than the applied amount.
Flexible Repayment Tenures – Personal loans come with repayment tenures ranging from 12 to 60 months. The lender where you apply must give you enough time to repay the loan.
Quick Disbursal – If you apply at a lender that has a slow sanction and disbursal process, you may not like that experience particularly when it is about fulfilling instant needs. And, if we talk about the market in general, most personal loan applications are made for instant requirements. In that case, it becomes necessary for you to choose the lender that can disburse you a loan quickly.