Often, situations arise when you need extra funds to meet expenses. You may have to reckon with costs related to medical emergencies, vacations, educational courses, home renovation, and more. A personal loan can help you meet these expenses without disturbing your current investments, or dipping into your savings.
Features of Unsecured Personal Loans
Personal loans are loans extended to you to meet your personal expenses. The loan is advanced based on the your credit history, and your ability to repay the loan. There are several features that make unsecured personal loans attractive. They are:
Personal Loans Are Collateral Free
Unsecured personal loans require no collateral or guarantor. There is no evaluation of assets required for pledging collateral. This reduces the paper work, and the time of processing.
Personal Loans Are Approved Instantly
Since collateral is not required, the processing time gets shortened. Several non-banking financial companies (NBFCs) such as Bajaj Finserv disburses money into your bank account within 24 hours.
Additional Read: Can You Apply For A Personal Loan For Travel?
Flexi Loan Facility
NBFCs like Bajaj Finance offer Flexi personal loan facility which allows you to borrow as you need and prepay when you can. You can borrow as per your need without utilising the whole loan facility. The interest will be applicable only on the borrowed sum. You can even make part-repayment without paying a penalty.
Nominal Interest Rate
Unsecured personal loan is available at nominal personal loan interest rates for the chosen tenor.
For example, if you want to take a loan of Rs. 1 lakh, for a tenor of 12 months, at interest rate 14%, the total payment would be Rs. 1,07,746. Your EMI would be Rs. 8979. For interest-only personal loan the EMI amounts to Rs. 646. approximately.
Minimum Eligibility Criteria
The eligibility criteria to avail personal loan is minimum for most lenders. These criteria include:
- Age
- Employment status
- Minimum net salary per month
- Good credit history
For example, Bajaj Finserv Personal Loan requires you to have a minimum salary of Rs. 40000 per month to avail the loan.
Minimum Documentation
Some basic documents required are:
- KYC documents
- Salary slips
- Employee id card, and
- Bank account statements of previous months
Flexible Tenor
Most lenders provide wide tenor to repay the money. It usually ranges from 12 to 60 months.
Personal loans are useful as you can get them immediately in order to meet any of your personal expenses. Having a good credit is vital. Flexible borrowing, and repayment makes it an attractive loan option.
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