Personal Loan
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Table of Contents
What is Personal Loan?
A personal loan is a type of loan that is issued by a financial institution, such as a bank, to an individual. It is a form of unsecured debt, which means that the loan is not secured by any collateral, such as a home or car. Personal loans are typically used for a variety of purposes, such as consolidating multiple debts, financing a vacation, or covering unexpected expenses. They can also be used to make large purchases, such as a car or home repairs.
Personal loans can be either fixed-rate or variable-rate. Fixed-rate loans have a set interest rate that remains the same throughout the loan repayment period. Variable-rate loans, on the other hand, have an interest rate that can fluctuate depending on the market.
Personal loans typically require a credit check and proof of income. The amount of the loan, the interest rate, and the repayment terms are all based on the borrower’s credit score and history. The repayment terms of a personal loan can range from six months to seven years. The interest rate can be either fixed or variable, and the amount of the loan will typically depend on the borrower’s credit score.
Personal loans can be used for a variety of purposes, including debt consolidation, home improvements, and financing a major purchase. It is important to note that personal loans typically have higher interest rates than secured loans, such as a car loan or mortgage. Additionally, personal loans are not typically tax-deductible.
When taking out a personal loan, it is important to make sure that the loan term and interest rate are affordable. It is also important to consider the total cost of the loan, including any fees and additional costs. Borrowers should compare different loan offers to find the best option for their needs.
Interest Rates of Personal Loan
You can avail a personal loan to meet your various financial requirements. There are different banks in India who proposition best Personal loans to their clients and you can without much of a stretch apply for it either on the web or disconnected. Nonetheless, before you benefit an individual credit, you should check the financing costs presented by various banks which differs between 8.90% p.a. furthermore, 42% p.a.
Analyse the most recent individual advance loan costs and handling charge of all banks and apply today.
List of banks with interest rates
| SBI | 10.75% – 16.25% |
| HDFC Bank | 10.99% – 20.00% |
| ICICI Bank | 10.99% – 22.00% |
| Axis Bank | 11.49% – 24.00% |
| Citibank | 11.99% – 22.00% |
| Bajaj Finserv | 11.99% – 24.00% |
| Kotak Mahindra Bank | 11.99% – 24.00% |
| Bank of Baroda | 11.50% – 13.50% |
| Bank of India | 10.35% – 13.50% |
| Canara Bank | 10.50% – 16.00% |
| Central Bank of India | 11.50% – 13.50% |
| DHFL | 12.99% – 24.00% |
| IDBI Bank | 11.50% – 24.00% |
| Indian Bank | 10.35% – 13.50% |
| Indian Overseas Bank | 10.50% – 14.00% |
| IndusInd Bank | 15.00% – 24.00% |
| Karur Vysya Bank | 11.50% – 13.50% |
| Punjab National Bank | 10.35% – 13.50% |
| RBL Bank | 11.99% – 24.00% |
| Standard Chartered Bank | 12.49% – 20.00% |
| UCO Bank | 11.25% – 13.50% |
| Union Bank of India | 10.50% – 13.50% |
| United Bank of India | 11.50% – 13.50% |
| Yes Bank | 10.99% – 21.00% |
Highlights of Personal Loans
Personal loans have following features and advantages that make one opt for the same.
- Access to funds quickly: Personal loans can be approved and funded in as little as 24 hours, allowing borrowers to get access to much-needed funds in a timely manner.
- Flexible terms: Personal loan terms are typically flexible, allowing borrowers to choose repayment periods that fit their budget and income.
- No collateral required: Personal loans are unsecured, meaning no collateral is required to secure the loan. This makes them ideal for those without assets to back up their loan.
- Lower interest rates: Personal loans typically have lower interest rates than credit cards, which can save borrowers money in the long run.
- Improve credit score: Making on-time payments on personal loans can help improve a borrower’s credit score.
- Consolidate debt: Personal loans can be used to consolidate multiple debts into one, making repayment more manageable and potentially reducing interest rates.
- No prepayment penalties: Personal loans typically do not have prepayment penalties, allowing borrowers to pay off their loan early if they wish.
- Quick online application process: Applying for a personal loan online is quick and easy, with most lenders offering a streamlined process.
- Fixed monthly payments: Most personal loans feature fixed monthly payments, so borrowers know exactly how much they will be expected to pay each month.
- No hidden fees: Personal loans usually come with no hidden fees, so borrowers can be sure of the exact cost of their loan.
- Lower monthly payments: Personal loan payments are typically lower than credit cards, making them easier to manage and less of a financial burden.
- No co-signer required: Most personal loan lenders do not require a co-signer, allowing borrowers to apply on their own.
- Use for any purpose: Personal loans can be used for almost any purpose, from home improvement to debt consolidation.
- No minimum credit score: Many lenders do not require a minimum credit score for personal loan approval, making them accessible to borrowers with less-than-perfect credit.
- No origination fees: Many personal loan lenders do not charge an origination fee, so borrowers can save money on the cost of their loan.
Fees & Charges of Personal Loan
There are some charges are apply on personal loan:
Interest Rate – It is vary bank to bank. (10% to 35%)
Processing Fee – It’s a one-time expense that banks and other monetary organizations duty to handle the credit sum. The charge can either be a level sum or record for a specific level of the credit sum. The individual advance disbursal sum is not the same as the applied sum on the grounds that the handling charge payable is deducted from the last option. However, the loan cost will be charged on the applied sum.
Late Payment Charges – If you pay the EMI after the due date, the Bank or lender will charge the 2% of late payment amount due.
Foreclosure Charges – If you want to deposit your loan amount before the original tenure, this is called foreclosure and some charges will apply for the same.
Personal Loan Eligibility Criteria
Personal loan eligibility criteria are the requirements that you must meet in order to be approved for a personal loan. In order to qualify for a personal loan, you must meet certain criteria that lenders consider when evaluating potential borrowers. In order to be eligible to apply for a personal loan, the borrower must meet certain criteria. Generally, these include the following:
- Age: The borrower must be at least 18 years of age and must not exceed the age of 60 years when the loan matures.
- Income: Most lenders require that you have a steady and consistent source of income in order to qualify for a personal loan. This means that you must have a job, a pension, or some other type of regular income. Your income should be enough to cover the cost of your loan payments, as well as other expenses. The minimum amount of income you must have in order to qualify for a personal loan varies from lender to lender. Generally, lenders require a minimum annual income of Rs. 2.5 lakhs from salaried individuals and Rs. 3 lakhs from self-employed individuals.
- Credit Score: Most lenders require a minimum credit score of 750 or above to be eligible for a personal loan.
- Employment: The borrower must be employed with a reputed company for a minimum of 2 years.
- Work Experience: The borrower must have a minimum work experience of 2 years in the same field.
- Residence: The borrower must be a resident of India.
- Bank Account: The borrower must have a savings bank account with a minimum balance of Rs. 25,000.
- Relationship with Bank: The borrower must have an existing relationship with the bank.
- Credit Score: Lenders will also look at your credit score when evaluating your personal loan eligibility. A good credit score indicates that you have a history of responsible borrowing and repayment. If your credit score is too low, you may not be approved for a personal loan. The minimum credit score required to qualify for a personal loan varies from lender to lender.
- Debt-to-Income Ratio: Your debt-to-income ratio (DTI) is another important factor in determining whether you are eligible for a personal loan. Your DTI is calculated by dividing your total monthly debt payments (including your mortgage, car loan, credit cards, etc.) by your total monthly income before taxes. Generally, lenders prefer a DTI of less than 36%. A higher DTI may indicate that you are overextended and may not be able to afford the loan payments.
- Collateral: Some lenders may require that you provide collateral in order to qualify for a personal loan. Collateral is an asset that you own (such as a car or home) that the lender can repossess if you default on the loan. Generally, lenders prefer that you have a good credit score and a reasonable debt-to-income ratio in order to qualify for a personal loan without collateral.
- Documents: The borrower must submit the necessary KYC documents, along with income proof, such as salary slips, income tax returns, etc.
- Other Considerations: In addition to the factors above, lenders may also consider other factors when evaluating your personal loan eligibility. For example, some lenders may require that you have a bank account or that you have a minimum level of savings. Additionally, some lenders may require that you have a cosigner if you have a lower credit score or higher DTI. Overall, personal loan eligibility criteria are the requirements that you must meet in order to qualify for a personal loan. Generally, lenders require that you have a steady source of income, a good credit score, and a reasonable debt-to-income ratio. Additionally, some lenders may require that you provide collateral or have a cosigner. By meeting the criteria outlined above, you can increase your chances of being approved for a personal loan.
Note – The eligibility criteria vary as per lender.
Personal Loan Process
Documentation is a significant part of a personal loan as carelessness on the equivalent can prompt dismissal of the credit application. So while applying for an individual credit, remember to present the records expected by the moneylender.
Salaried Person Documents
- ID Proof – PAN Card/Voter ID/Aadhaar Card/Passport/Driving License
- Proof of Residence – Voter ID/Aadhaar Card/Passport/Driving License/Electricity Bill/Telephone Bill
- Proof of Income – Salary slips for the last 3 months, bank statement for the last 3 months
- Recent passport size photographs
Self-employed Person Documents
- ID Proof – PAN Card/Voter ID/Aadhaar Card/Passport/Driving License
- Proof of Residence – Voter ID/Aadhaar Card/Passport/Driving License/Electricity Bill/Telephone Bill
- Business Address Proof – Electricity Bill/Landline Bill/GST or VAT Registration
- Proof of Income – Salary slips for the last 3 months, bank statement for the last 3 months
- Recent passport size photographs
Calculate the Personal Loan EMI:
Any one can use CREDIT SEVA EMI Calculator for free to calculate EMI of all type of loans
Personal Loans Types
- Unsecured Personal Loan: This type of loan is not secured by any collateral and is best suited for those who don’t have any assets to offer as collateral. It is a loan taken for personal expenses and can be used for almost anything including debt consolidation, home improvement, vacation, wedding, medical, education, auto, motorcycle, boat, and RV purchases. The interest rate on an unsecured personal loan is usually higher than a secured loan.
- Debt Consolidation Loan: This type of loan helps borrowers pay off multiple debts, such as credit cards and other loans, with a single loan. The new loan usually has a lower interest rate, which makes the payments more manageable.
- Home Improvement Loan: This type of loan is taken for repairs, renovations, and other improvements to a home. The loan can be used for both exterior and interior improvements. The loan can also be used to pay for the cost of the materials used in the improvements.
- Vacation Loan: This type of loan is taken to pay for the cost of a vacation. It can cover the cost of travel, lodging, meals, and other expenses. The loan is usually taken out for a short period of time and requires repayment once the vacation is over.
- Wedding Loan: This type of loan is taken to pay for the cost of a wedding. It can cover the cost of the venue, catering, decorations, and other expenses. The loan is usually taken out for a short period of time and requires repayment once the wedding is over.
- Medical Loan: This type of loan is taken to pay for medical expenses. It can cover the cost of doctor visits, medications, treatments, and other medical expenses. The loan is usually taken out for a short period of time and requires repayment once the medical expenses are paid.
- Education Loan: This type of loan is taken to pay for educational expenses. It can cover the cost of tuition, books, supplies, and other educational expenses. The loan is usually taken out for a short period of time and requires repayment once the educational expenses are paid.
- Auto Loan: This type of loan is taken to pay for the purchase of a vehicle. It can cover the cost of a new or used car, truck, or SUV. The loan is usually taken out for a short period of time and requires repayment once the vehicle is purchased.
- Secured Personal Loan: This type of loan is secured by collateral. The collateral can be anything of value, such as a car or home. The interest rate on a secured personal loan is usually lower than an unsecured loan.
- Peer-to-Peer Loan: This type of loan is taken from an individual or a group of individuals. The loan is usually taken out for a short period of time and requires repayment once the loan is repaid.
- Emergency Loan: This type of loan is taken for unexpected expenses. It can cover the cost of medical bills, car repairs, home repairs, or any other unexpected expense. The loan is usually taken out for a short period of time and requires repayment as soon as possible.
- Short Term Loan: This type of loan is taken for a short period of time. It can cover the cost of any short-term expense. The loan is usually taken out for a short period of time and requires repayment once the loan is repaid
Apply for a Personal Loan using Credit Seva?
Applying for an individual credit online has become more straightforward at Credit Seva, an impartial monetary commercial center that offers unprejudiced counsel on credits and other monetary items. Furthermore, where most computerized stages have the typical mortgage application, Credit Seva has WhatsApp method of use other than the standard advance application. We should learn about both these application modes.
Online Personal Loan Application Form
Check out the steps you need to follow while filling the online personal loan application form at Credit Seva.
- Visit the Credit Seva website
- Go to ‘Personal Loan’
- Fill the details for ‘Desired Loan Amount’, ‘Employment Status’, ‘Monthly Income’ and ‘City’
- Click on ‘Get Quotes’
- As per your details, different loan quotes appear on your screen
- Choose the one that you think is best for you
- Credit Seva representatives will contact you and take your personal loan application to the concerned lender
Why use Credit Seva for Personal Loan?
- Secure Platform
- Agreement with Many Banks/Financial Institutions
- Easy to Use
- Provide Good Expert Advice
- Multiple Application Process
Personal Loan Frequently Asked Questions (FAQs)
Que : How Improve Your Chances Of Getting A Personal Loan?
Ans :
Credit Clean-up
One of the primary elements thought about by banks is your financial assessment. Getting an individual credit is more straightforward with a high FICO rating. Assuming your score is low, you should really take a look at your reports to check whether there are any blunders. Now and again, basic blunders could antagonistically affect your scores, and in the event that you find any of these, you should report them to CIBIL.
Rebalancing your income and debts
Banks request verification of pay when you apply for Personal Loan to determine your relationship of debt to salary after taxes. Consider the offer of fluid resources like stocks or procuring more through a seasonal task to expand your yearly pay. Doing so will expand your relationship of debt to salary after taxes and increment your possibilities getting a loan.
Consider Co-signers/Guarantors
On the off chance that you are finding it hard to get an individual credit voluntarily, you can apply for one by adding a co-endorser or underwriter. The individual you pick as an underwriter should have a decent FICO rating. Their primary point is to ensure that you will reimburse the advance. Be that as it may, they will likewise be at risk to reimburse the actual credit on the off chance that you can’t do as such. Picking a person with a FICO rating more than 750 will significantly build your possibilities getting personal loan.
Limit Your Borrowing
It tends to be dangerous to request more cash than you expect to meet your monetary targets. Ensure that you compute the amount you want and apply just for that particular sum
Choose the Right Lender
Each loan specialist has their own necessities with regards to FICO ratings and pay. While searching for individual credits, pick a moneylender whose qualification standards you meet and apply in like manner. The issue with applying with different banks is that every one of them will check a FICO rating, and each time your full credit report is pulled out, your FICO rating drops, yet hardly.
Que : How Check Personal Loan Status?
Ans :
Online Mode
Most banks offer the choice of signing in to their authority entrance to assist you with following the situation with your credit application. You can utilize the application number or reference number which is given by the loan specialist for this motivation. Then again, in the event that you have applied for a credit through an outsider aggregator site, for example, BankBazaar, you can simply sign in to its web-based interface and track the situation with your advance application straightforwardly.
Offline Mode
In the event that you are not happy utilizing the web-based stage, you can likewise follow the situation with your own advance application through the disconnected means. You can visit the branch office of your credit supplier and actually look at the situation with your advance application. Then again, you can likewise interface with your loan specialist via phone through their helpline or client care number.
Que : How to Get Personal Loan Statement?
Ans : You can undoubtedly reach out to your moneylender either through their internet based web-based interface or face to face and demand for your advance assertion. On most moneylender sites, you can simply sign in utilizing your web-based certifications and give your credit account number. Whenever you have followed your record, you can demand for an explanation which is either shipped off your enlisted email ID or gave as a PDF document which can be downloaded. Likewise, you can likewise visit the branch office of the moneylender from where you have benefited the credit and spot a solicitation for an assertion. Likewise, you can raise a solicitation for your own credit proclamation through telephone banking too.
Que : How to Avoid Rejection Of Personal Loan Application?
Ans : The endorsement of personal loan application relies upon various variables. At the point when you apply for a credit, you ought to ensure that you are adequately satisfying every one of the variables to guarantee the endorsement of your advance application. The qualification models for individual advances might change from one moneylender to another, in any case, there are number of normal rules which incorporate the age of the candidate, their pay, financial assessment, status of business, etc. Before you apply for a credit, ensure that all the qualification rules are being satisfied. This will assist you with keeping away from dismissal of your credit application. Despite the fact that there are different choices which you can turn to on the off chance that your credit application gets dismissed, it is prescribed to twofold check prior to applying to keep away from the opportunity of dismissal of the application.
Que : What is Personal Loan Top Up?
Ans : A personal loan client can profit an extra advance sum through the top-up office over his/her current advance. The advance sum will be dependent upon the agreements set by the monetary moneylender, while the financing cost might be equivalent to the current credit or could ultimately depend on 1% more than the loan fee of the ongoing credit. The residency of the top-up credit will be dependent upon that of the current individual.
Que : What are Benefits of Personal Loan Top-Up?
Ans :
- Existing personal loan customers are eligible for the loan top-up provided that they have paid their EMIs regularly and have no pending payments.
- Minimum documentation required.
- Quick or instant disbursal of the top-up loan amount.
- Zero processing fee offered by a number of lenders.
- No collateral required.
Que : What are Benefits of Personal Loan Balance Transfer?
Ans :
- Get a reduced interest rate on the existing loan amount..
- Option to top-up the loan.
- Avail flexible repayment options.
- Zero processing fee offered by a number of lenders.
- Avail benefits such as zero processing fee, waiver of last EMI benefit, etc..
- To get better customer care service.
Que : What is Personal Loan Disbursal?
Ans :Personal loan disbursal is essentially the course of the monetary moneylender dispatching the credit sum in the financial balance of the client. The credit disbursal happens after the accommodation of important records of the client and the check and endorsement of the monetary loan specialist.
Que : What are Tips for Successful Personal Loan Application?
Ans :
- Do legitimate exploration before you apply for a loan
- Do peruse the fine print cautiously
- Do set aside your cash cautiously when you are reimbursing
- Do pay your advance portion speedily each and every time
- Do assess your credit score completely
- Do have any significant bearing for a reasonable loan amount.
Que : How Much Personal Loan Can You Get from Banks and Financial Institutions?
Ans : The amount of personal loan you can get from banks and financial institutions depends on several factors, including your credit score, income, and debt-to-income ratio. Generally, most lenders will offer personal loans up to 50,00000, although some may offer higher amounts. It’s important to remember that the maximum loan amount you’re eligible for is based on your individual financial circumstances.
Que : What is maximum duration of personal loan?
Ans : The maximum duration of a personal loan can vary depending on the lender, but typically the longest loan term can range from 60 to 84 months (5 to 7 years).
Que : Approval time in personal loan?
Ans : You can get a personal loan in 3-7 working days.
Que : What is the Rate of Interest on a Personal Loan?
Ans : Personal Loan interest rate may anywhere between 10%-20% per annum.
Que : Is the GST Levied Over the Interest Rate on a Personal Loan?
Ans : No, the Goods and Services Tax (GST) is not levied over the interest rate on a personal loan.
Que : How Much Work Experience is Required to Get a Personal Loan in India?
Ans : You must have worked for a minimum of 2-3 years to get a personal loan in India. However, lenders also want you to have a minimum of 1-year work experience with the current organization.
Que : What is the Processing Fee of a Personal Loan?
Ans : It’s a one-time fee that banks and financial institutions charge to process your personal loan. The fee can be a flat amount or a certain percentage of the loan amount. A 18% GST will also applied over the processing fee amount.
Que : What Will Happen If You Pay EMI After the Due Date?
Ans : If you pay your EMI after the due date, you may be charged a late payment fee, and it will also have an adverse impact on your credit score. Additionally, some lenders may take legal action against you if payments are overdue for a certain period of time.
Que : Will the Late Payment Affect Your Credit Score?
Ans : Yes, a late payment can affect your credit score. The severity of the impact will depend on the amount of the late payment, the length of time it is late, and the credit bureaus that report it. Generally, late payments will stay on your credit report for seven years, and can result in a drop of anywhere from 60 to 110 points on your credit score.
Que : Do Lenders Ask for a Guarantor Before Disbursing a Personal Loan?
Ans : No, lenders usually do not ask for a guarantor before disbursing a personal loan. Most lenders rely on the borrower’s credit score and other factors to determine their ability to repay a loan. A guarantor is generally only required if the borrower has a poor credit history or is unable to provide sufficient proof of income.
Que : Can a Personal Loan be Given on a Joint Basis?
Ans : Yes, it is possible to get a personal loan on a joint basis. Many lenders will offer joint personal loans, which allows two people to share the loan and the responsibility of making payments. However, both parties will need to meet the lender’s eligibility criteria and provide their own financial information.
Que : Can I Get a Personal Loan if I Have a Bad Credit Score?
Ans : Yes, it is possible to get a personal loan with a bad credit score. However, your interest rate may be higher than someone with a good credit score. Additionally, you may be required to provide collateral or a co-signer in order to get the loan. It is important to shop around to find the best lender for your needs and to compare interest rates and other loan terms.
Que : Is it good to take personal loan?
Ans : This depends on your individual financial situation and goals. It is important to consider the terms of the loan, including the interest rate and repayment terms, to determine if a personal loan is the best option for you. Additionally, you should also consider other options such as using savings, asking family or friends for a loan, or using a line of credit or credit card to finance your needs.
Que : Name 30 Names of banks and NBFC’s providing personal loan in india?
Ans : 1. HDFC Bank 2. ICICI Bank 3. Axis Bank 4. State Bank of India 5. Bajaj Finserv 6. Fullerton India 7. Tata Capital 8. IndusInd Bank 9. Bank of Baroda 10. Standard Chartered Bank 11. Kotak Mahindra Bank 12. RBL Bank 13. DHFL 14. Bank of India 15. Indian Bank 16. Punjab National Bank 17. Aditya Birla Finance 18. Magma Fincorp 19. Reliance Money 20. IDFC First Bank 21. Yes Bank 22. Tamilnad Mercantile Bank 23. UCO Bank 24. AU Small Finance Bank 25. DBS Bank 26. Jana Small Finance Bank 27. Punjab & Sind Bank 28. Karur Vysya Bank 29. Saraswat Bank 30. Allahabad Bank
Que : What is the range of rate of Interest of personal loan?
Ans : The rate of interest for personal loans typically ranges from 5.99% to 36%.
Que : What is a personal loan?
Ans : A personal loan is an unsecured loan used for a variety of reasons, from consolidating debt to financing large purchases.
Que : What are the requirements to get a personal loan?
Ans : In general, you will need to provide proof of income, such as pay stubs or bank statements, as well as proof of identity and residency.
Que : What are the interest rates for a personal loan?
Ans : Interest rates for personal loans vary, depending on the lender, your credit score, and other factors.
Que : How long is the repayment period?
Ans : Repayment periods for personal loans also vary, but typically range from one to five years.
Que : What is the application process?
Ans : The application process typically involves filling out an online form and providing the required documents.
Que : What are the fees associated with a personal loan?
Ans : Fees associated with personal loans can include origination fees, late fees, and prepayment penalties.
Que : Are there any tax benefits associated with a personal loan?
Ans : In some cases, the interest paid on a personal loan may be tax deductible.
Que : Are there any risks associated with a personal loan?
Ans : Yes, as with any loan, there is a risk of default. It is important to make sure you understand the loan terms before taking out a personal loan.
Que : What should I consider before taking out a personal loan?
Ans : Before taking out a personal loan, you should consider your financial goals, credit score, and ability to make payments on time.