If you have a large payment to make and are worried about how you will manage the same, consider applying for a personal loan. Whether it is the renovation expense, a wedding or a holiday you have to pay for, a personal loan will make it easier and convenient for you. The loan is designed to help achieve your goals and will ensure that you do not end up using the emergency funds for the payment. With low personal loan interest rates, you can make the loan repayment in time. Here are a few things you must know about the personal loan before you proceed to make an application.
The biggest advantage of applying for a personal loan is that the funds can be used for any purpose for your personal needs. The lender will not question you about the same and there are no restrictions associated with it. You just need to decide on the loan amount and make an application.
In order to apply for a personal loan, you need to be an Indian citizen and above the age of 21 years. You can apply for the loan whether you are salaried or self-employed. If you are a salaried individual, you should be employed for a period of at least six months and if you are self-employed, you should have a business in existence for at least two years. Additionally, lenders have a minimum income criteria you should be aware of. To be eligible for the loan, you should have a minimum monthly income of Rs. 15,000.
The maximum loan amount is Rs. 5 lakh and the maximum repayment tenure is up to 60 months.
You can make an online loan application and submit the necessary documents. As a salaried individual, you need to submit a duly filed loan application form, identity proof, address proof, income proof, proof of residence ownership, proof of job continuity, and passport sized coloured photograph. If you are self-employed, you need to provide the duly filed loan application form, identity proof, address proof, residence proof, passport sized coloured photographs, business existence proof, income proof and job continuity proof.
How it works?
The loan application process is simple and hassle free. Once you decide on the amount of funds you need and the lender you want to borrow from, all you need to do is make the application. There is no need to head to the physical branch of the lender. You can make an online personal loan application and submit the necessary documents. Once everything is in place, the lender will verify the documents and approve your loan application.
Things to keep in mind
- Compare interest rates: You must compare the personal loan interest rates before you make the loan application. It will have a direct impact on your monthly outflows and budget. Hence, compare the rate of interest and choose a lender that offers a low interest loan. This will allow you to make the most of the loan without stretching your budget.
- Use EMI calculator: No matter the loan product you choose or the lender you want to work with, remember to use the EMI calculator. You can find it for free on the website of the lender and it will help make the right borrowing decision. All you need to do is provide the loan amount and tenure. The calculator will give you an estimate in no time and you will be able to decide whether you should proceed with the loan or not. It also helps to prepare a repayment schedule to ensure that the payment is made on time and does not hurt your credit score.
- Not suitable for business needs: An important thing to keep in mind is that the personal loan is not suitable for any of your business needs. So, if you are looking to apply for a loan to expand your business, you need to consider the available business loan options and not opt for a personal loan.
An ideal form of borrowing, the personal loan is the first choice of many and it can help meet several goals. Remember to choose a reliable and trustworthy lender for the purpose of borrowing and make the repayments on time.