In India, you can get various types of loans to fulfill your various needs. The interest rates, tenure and EMI schedule is decided on the basis of borrower’s profile. Amongst various types of loans, personal loans are the most opted type of loan in the country. Personal loans are easy to get and easy to pay off. We have listed a few reasons behind the popularity of personal loan
1. They have easy availability:
The main reason behind the popularity of personal loans is untroublesome availability. The personal loans can be acquired within 24 to 48 hours of loan application and submission of required documents. Almost all banks offer personal loans to its customer thus making it easily accessible.
2. They don’t need any collateral:
To get approval on a personal loan, you do not need to offer any collateral or guarantee. Bank approves personal loan on the basis of borrower’s income details and financial history. Your CIBIL score matters the most in terms of personal loan approval. As you do not require offering your fixed assets as mortgage or collateral, you can access the loan easily.
3. They need minimum documentation:
Unlike the other long term or larger loans, personal loans require very little documentation. Plus you don’t have to submit extra paper work for collateral as it does not require any. Thus these loans are approved quickly without any hassle.
4. They are given in expeditious approval:
As many financial institutions offer personal loans and they require minimum documentation, they are approved quickly. When it comes to online personal loan approval, they are approved quickly where as the paper approval takes not more than one to two working days. The mechanism of approving personal loan is very easy, efficient and hassle free.
5. They can be used to consolidate your debts:
When it comes to financial debts, it’s always wise to clear off a high-interest debt by taking a low-interest debt. If you happen to have multiple debts, you can combine them under one umbrella. By opting for a personal loan, you can pay off your multiple debts and be answerable to only one, which is a more hassle-free solution! Also you can clear your credit card bills by choosing personal loan for a balance transfer. This will allow you to enjoy lower interest rates.
6. They are multi-purpose loan:
The fund from personal loan can be used for any purpose. Be it a wedding or medical expenses; home renovation or personal bulk shopping, you can use these funds as they suit your needs. They can mainly be used to overcome any financial adversaries. Borrower can apply and access the loan amount without disclosing the purpose of the same.
7. They are offered in adjustable sum:
Based on various criteria like level of income, employment history, credit score and scope for repayment, you can get a personal loan ranging anywhere between Rs. 1,00,000 to Rs. 20,00,000. Though this also depends on the bank, the amount has always been extremely flexible.
8. They offer flexible payback option:
To payback your personal loan, banks offer you a tenure ranging from 1 year to 5 years. Thus it is easy for the borrower to pay back the loan with easy EMI policies. Though this depends on the amount of loan and the bank policies, it is always a better option from other types of loans.
9. They come with varied interest rate:
Depending on eligibility criteria, the borrowed sum, payback tenure and the lender (NBFC or bank), the interest rate varies on personal loan. They start from as low as 10.85%. Many banks use their specially developed interest rate calculator to give you a fare percentile of interest rate.
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