A personal loan is a kind of unsecured loan people take to fulfill their personal expenses (medical, education, wedding, holiday). You don’t have to mortgage anything for taking this loan. The documentation process of this loan is so minimal. But sometimes interest rates are high. For taking personal loan a good Credit history is really important. The interest rate really depends on your credit history.
Points you should remember before taking a personal loan
- A personal loan has fixed interest rate so the interest rate doesn’t fluctuate so it is safer than a credit card.
- When you are taking a personal loan you should repay it on time because if you don’t repay it on time your credit score become low and next time you go for a loan bank may won’t give you a loan or your interest rate can be so high.
- When you are taking a personal loan don’t just go for one bank or one NBFC and take the loan you should check 2 or 3 places before taking a personal loan because the interest rate an prepayment charges really matter.
- Borrow that amount what you need don’t borrow so much. You should remember at the end of the day you have to repay the amount with a interest rate of 13% to 15%
- Take personal loan for a long time which decreases the interest rate. If you take a personal loan for short time the interest rate can be high.
- Before giving you a personal loan bank don’t take your home as mortgage or anything else but they do check your NET salary, your credit score all these things and the interest rate depends on these.
- The penalty charges are really heavy on the EMI of personal loan. So don’t miss any EMI because it also effects on your CIBIL SCORE. So repay it on time.
- The disbursal time for a personal loan is at least three or four days so don’t fall for those companies who say the disbursal time is 24hours. Either they are lying or they are fake.
- You should have your Credit score 850 for getting a lowest interest rate. Low credit score doesn’t help.
- When you are taking a personal loan you should read all papers carefully what is the pre-payment charge? If you can repay your loan before time? etc.
Eligibility Criteria for Personal Loan
- Minimum age of 21 years and maximum of 60 years.
- Minimum 2 years of work experience if self employed minimum 2 years of business experience.
- Minimum income 25,000
- Minimum CIBIL score 650
- The applicant should have an account in this bank.
Documents require for Personal Loan
- Pan Card
- Aadhaar Card
- Voter’s ID
- Passport Size Photo
- Driving License
- A cancelled cheque
- Salaried : Last 3 years of PAYSLIPS, 6 months salary account bank statement.
- Most recent salary certificate with Form16.
- Installments applicant is currently paying , all the numbers of credit cards.