If you have any emergency fund requirements for family or business, consider applying for a personal loan. You may require funds for home renovation, wedding, medical treatment, debt repayments, deal with losses in your business, etc. That you did not plan in advance. For personal loans, you need not keep any mortgage with the lender and can repay back in EMI (Equated Monthly Instalments).
You can apply for an offline or online personal loan and if you meet the eligibility criteria, the lender will disburse the amount quickly. The online process is easier and time-saving. Read on to know more about this category of loan.
The initial step is to apply for the loan and wait for the lender’s approval to scrutinize your eligibility. Different lenders may have separate requirements for eligible applicants.
Some of the common requirements include:
- You should be residing in India
- You have to be a salaried employee or a self-employed individual having a steady source of income
- As you do not have to provide any security to assure loan repayment, the lender will focus on your income and financial stability
- If you are a salaried employee, you have to be employed in the
- government sector including public sector undertakings, central and local bodies
- a public or private limited company
- There is a minimum age criteria for the applicant, generally 21 years or above
- The maximum age at the time of maturity of the loan may be 60 years
- A minimum net monthly income cut-off as specified by the lender
- For self-employed people, disclose the number of years that the business has been operational, like three to five years.
- For business owners, proof that the business is profit-making projected cash flows for the next couple of years, its financial viability, etc.
- Ensure that you have a good credit score. You can do this by making your loan payments on time like the credit card bills, monthly loan instalments, etc.
- Proof of staying in your current location for a minimum number of years
Advantages of personal loans are:
- Once you meet the eligibility criteria, you will get an offer with the sanctioned amount, tenure of loan and interest rate.
- If you accept the offer, the lender will transfer the funds to your bank account instantly.
- Use the personal loan to meet unexpected expenses like a wedding expenditure, school or college fees, vacation expenses, home renovation projects, purchase of products and so on.
- Some lenders offer pocket-friendly EMIs with flexible repayment tenure/period
- You can pay through auto-debit instruction through your bank account that would reduce your chances of default
- Know your EMI amount before applying for a loan with the help of an online EMI calculator
- Apply for an online personal loan from the comfort of your home or any other remote location without submission of any hard copy. You can also submit the application form online in a few clicks.
- You do not have to provide any security or collateral to get a personal loan as it is a type of unsecured loan.
- There is no burden to arrange for collaterals like gold, property or shares.
- You can get a low-interest personal loan if you meet the eligibility requirements.
- There is no restriction on the amount that you can borrow subject to certain conditions
- The process of verification, documentation and disbursal for personal loans is fast. They also require minimum documents for approval.
What is the benefit of a personal loan EMI calculator?
With an online personal loan EMI calculator, you can find out the monthly instalments that you have to pay for loan repayments along with interests. The EMI is a key factor in deciding the loan amount and tenure.
It helps you to instantly calculate your pay-outs and, plan your budget in advance so that the repayment process is not stressful. The results that you would get are:
- Monthly Repayments – EMI that you will be paying every month
- Total interest payable – Total interest on your loan
- Total amount to pay – The total amount which is a sum of principal and interest
The steps of calculating the EMI involves:
- Enter the loan amount, rate of interest and loan tenure
- The EMI will be instantly displayed.
- If you wish to change the EMI adjust the loan amount, interest and tenure and get the result
- If you wish to lower your EMI, you can reduce the loan amount, the interest rate or increase the loan tenure.
- And if you can manage to pay higher EMIs, you can increase the loan amount or reduce the tenure.
The interest on personal loans is usually high as you are not providing any security. The different types of personal loans are:
Personal loan for home repair or renovation
You may decide to carry out some repair work or renovate the house and this would require a lump sum amount of money. A personal loan can help you in the process.
Whether it is remodelling your kitchen or creating an additional space or floor above, a personal loan for the home renovation can be a convenient solution.
Personal loan for wedding
In India, wedding costs run-up in lakhs even for a medium budget function. Using up your savings may not be a good option.
A personal loan can cover the expenses and you can repay back in EMIs. Calculate the approximate costs with an EMI calculator and apply right away.
Personal loan for travel or vacation
You can get a personal loan to cover your travel expenses, especially if it is a vacation abroad with family. It is a convenient and economic option.
Instead of paying for the entire expenses with a credit card, you can apply for some amount of personal loans. It may help you to save on interest costs.
The working capital requirements in the case of a business is an important factor and without fresh funds, the everyday operations can get affected under certain circumstances.
A personal loan can be an option to meet your short-term working capital requirements such as accounts payable, wages, etc.
Top Up Personal Loan
Some lenders may provide the option of a Top-up personal loan facility. It allows you to borrow a certain amount of money over your personal loan. The interest rate for a top-up loan may be higher than a regular personal loan.
Personal loans are a convenient way to meet your fund requirements without draining your savings. Whether the EMI will fit in your monthly budget can help in deciding the personal loan amount. The personal loan Interest calculator can help you find out an appropriate loan amount before you finalise your decision regarding an offline or online personal loan.