Almost all banks provide personal loan. One benefit of a personal loan is that you do not need to explain the reasons for taking the loan to a bank. The amount given to you can be used any way you want. All banks have set their own criteria for giving a personal loan. You can get loans from Rs. 10,000 to up to Rs. 15,00,000 depending on your income and repayment capacity.
To avail of the loan you need a source of regular income and written proof of that. While applying for a personal loan you need to submit some documents like your income proof, residence proof, photo identity proof and stability proof of your income. Below are the details of documents required:
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Identity Proof: Photo Pan card, passport, driving license or voter ID card.
Address Proof: Passport, driving license, ration card, voter’s ID card, bank statement or rent agreement with address mentioned.
Date of Birth Proof: Pan card, passport, driving license or LIC policy with the mention of date of birth.
If you have any running loan then the proof of its regular payment and also bank statement.
All the papers should be duly self-attested.
Financial documents: Additionally you require some financial documents. If you are a salaried person then you require last 3 month salary slip and Form 16, along with bank statement of last 6 months. If you are a self-employed person then you need proof of income for last two years, last 2 year’s company balance sheet and also bank statement of last 6 months.
What is a Personal loan?
A bank loan given to an individual by a bank for any purpose is called a personal loan. A personal loan can be taken for any number of purposes like foreign trip, marriage, education or just for buying some expensive item.
One benefit of taking a personal loan is that you do not need to provide any collateral to the bank for securing a personal loan. The bank also does not ask for any guarantor for taking a personal loan.
What purpose personal loan should be taken for?
A personal loan can be taken for any number of purposes. You can take a personal loan for any number of purposes like foreign trip, marriage, education or just for buying some expensive item. All you need to prove to the bank that you have a regular income and you can repay the loan amount.
How do I take a Personal Loan?
To apply for a personal loan, you need to research about various banks offering it. Almost all banks offer personal loans to individuals. Check for the best interest rates and best offers of banks. Also check the documents required and eligibility criteria for various banks. You can then apply to a bank for a personal loan.
How is personal loan eligibility determined?
Various banks have their own eligibility criteria for providing loans. Banks look for a proof of a regular income from persons seeking a personal loan. Eligibility criteria of banks differ from one another.
What is the tenure of a personal loan?
A repayment period of a personal loan may range from one year to a maximum of five years. Personal loans are offered for shorter periods compared to other types of loans.
How much personal loan that I can take?
You can take a personal loan of Rs. 15,000 to Rs.15,00,000 depending on your capacity to repay. The amount of the loan depends on your desire as well as on your re-paying capacity. It also depends on income, place of work, residence and city. Normally the installments you pay to the bank should not exceed more than 30 to 40% of your net salary.
What is the rate of interest charged on my loan?
The rate of interest depends on the bank offering the loan. Banks have their own rates of interest that also keep changing depending on market conditions and the regulations set by the Reserve Bank of India. The rate of interest of personal loan range from 10% to 26% depending on the bank as well as the eligibility of the person applying for the loan.
How much time it takes to process the loan?
The time taken on all the process depends on the bank. However, normally it takes around 72 hours to a maximum one week to disburse the loan amount.
Can I apply for loan, jointly with my spouse?
Yes. You can apply jointly with your spouse for a personal loan. This will increase your income eligibility, helping you get a larger amount of loan.
How do I repay my loan?
You can repay your personal loan amount in Equated Monthly Installments (EMIs) using post dated cheques or by signing an ECS (Electronic clearing system). On a pre-determined day the bank takes EMI amount from your bank account.
Do I need to open an account with the bank for availing the loan?
No. You can avail of the facility of a personal loan even with a bank you do not have an account with. However, if you already have a bank account with that bank then you may get a special rate of interest.