Personal Loan
HOW DOES PERSONAL LOAN WORKS

Personal loans are offered by banks and online lenders and can be used for a wide variety of needs, from making a home repair to paying for dental work. It can open up new possibilities, act as a lifeline in tough situations and even help you repair your finances when you’re badly in debt.

A personal loan is a short-term loan to assist you with your finances. These loans have become quiet popular today, and now this is the main way to get financial assistance in the form of a cash advance.

Key areas to utilize Personnel loan

CHECK OUT THE FOLLOWING IT DESCRIBES THE PURPOSES OF PERSONAL LOAN

• Festive Spendings

• Medical Emergencies

• Dream Marriage

• Higher Education

• Home Renovation

• Higher End Lifestyle Products

• Higher End Consumer Goods

• Dream Vacation

Eligibility for a Personal Loan:

Since it is unsecured in nature, lenders have stricter norms regarding eligibility and sanctioning of personal loan. But some of the basic eligibility criteria the applicant must fulfill are:

Nationality: Indian.

Age limit – The standard age limit is minimum 21 Years.

Employment Status : Employed or In-business/self employed.

Repayment Tenure: upto 60 Months

Credit Score : CIBIL score of 600 or more

Rate of Interest and Loan Amount

The Factor depend on rate of interest and the eligibility are:-

Your employment is also an important factor in the loan-approval process.

The higher your credit score, the better are your chances of being approved.

Fees and Charges

As far as processing fee is concerned, it varies from bank to bank, loan amount or the special schemes operated by respective lending institutions. It will be in the range of bank to bank differ. However the best part of Personal Loan is processing fee is not charged upfront, it gets deducted from the loan amount. So here we get good option to compare the loan schemes with various banks and pay processing fee to the bank we zeroed in.

Foreclosure Charges also vary from lender to lender. In few institutions, it is NIL after a certain period of time which is known as Lock-in period or the charges get reduced after 1 year or 2 years.

DOCUMENTS CHECK-LIST

To initiate the personal loan process, the lender will require:

Application Form signed by applicant with photograph

KYC DOCUMENTS

• Proof of Identity Pan Card / Valid Passport / Voter ID card / Valid Drivers License.

• Proof of Address Aadhaar card / Electricity / Phone Bill of latest 3 months.

PROOF OF INCOME AND OTHER DOCUMENTS:

• Form 16 for the previous 2 years.

• Salary slip for previous 3 months.

• Latest bank statement/Passbook from where you can show salary/income being credited for the previous 6 months.

• Employee contract or appointment letter in case of current employment is less than 1 year.

• Passport size photograph of all the applicants / co-applicants to be affixed on the application form and signed across.

• The Cheque for processing fee.