Personal Loan and its Benefits
Personal Loan is an unsecured Loan, which can be used for any purpose. Either it’s a holiday trip, home renovation, marriage or any other purpose, the Personal Loan allows a person to spend freely with no restrictions. In fact, a Personal Loan is a great boon during the times of urgent needs and with no hassles, and with minimum paperwork, a Person can avail Personal Loan for the personal requirement, whatever the need is. Since, it is unsecured in nature, there’s no need to put any collateral and this is just one of the fields, where Personal Loan scores.
Here are some benefits of a Personal Loan:
Hassle Free Loan Processing
The personal Loans are considered as the easiest Loan type, which can be approved in quick time. With the complete process, hassle free, there’s no reason to get worried over the Loan approval and all you need is to apply online. You can do the same with Deals of Loan application to enjoy hassle free Loan processing.
Easy or no paperwork
As we can recall, the Personal Loans are the Loans among all other Loan types, which requires minimal paperwork or even no paperwork. The paper work at maximum, required for the personal Loan is ID Proof, Address Proof and Income Proof. And more importantly, if you are already pe approved for the personal Loans, you may require submitting no documents at all. Isnt Personal Loans, is easy? if you are still skeptical, just try knowing the documentation required in other Loan types!
No collateral required
Sine Personal Loans are the unsecured Loans; these require no collateral at all. Personal Loans are the unsecured Loans, and you don’t need to mortgage collateral like home, or shares or anything else, to avail Personal Loans. The Banks and lending agencies just check the repayment capability of a person, before sanctioning any Loan to the person. Once they are sure of their Loans not getting default, they approval the Personal Loan application of the person.
With no paperwork, and no collateral, the process really becomes very quick for the approval of Personal Loans. You can get a pre approved personal Loan in less than 10 seconds if you are a HDFC Customer, while any other bank customers can get it in 4 hours. Also, all the fintech companies are powerful and quick enough to offer the customers with the personal Loans within 24-48 hours, for sure!
Spend on any purpose
Some borrowers often get confused, over what they can spend personal Loans! Clearing the clouds of confusion, the Personal Loans can be availed for any purpose. Perhaps, the biggest benefit of Personal Loans is that you can spend the Personal Loan Amount for any purpose and even you don’t need it to mention it, while applying for a Personal Loan. Spend on your trips, covering wedding costs, for education, for home improvement, for buying a car and for any other purpose, not stated here. So, Marriage on the cards? Planning for a family trip? Unexpected huge medical bills knocking your doors? Wedding on the cards? There’s no limitation on the end use of personal Loan and you are free to spend on your money, on whatever you like to!
With any Loan, there comes an added responsibility and that responsibility is in the form of EMIs. The Loans are to be repaid and that repayment is to be done in EMIs. The Personal Loans are no exceptions; however with Personal Loans, you can pay off the debt in easy EMIs, Since the Loan Tenure vary from 12 months to 60 months and in some conditions up to 84 months; the Personal Loans can be repaid in easy EMIs. Also, lower interest rate as low as 12.5% helps you additionally to pay off the complete easily, without any worry. You can also use EMI Calculator available at several websites to calculate the exact EMI; you will be paying at your Personal Loans.
Flexibility to choose Loan tenure
You are the boss here! With the complete flexibility over the Loan tenure, you can choose Loan tenure ranging from a minimum to 1 year to 5 years. With such a flexibility being offered to a person, he/she can better calculate expenses and savings and can better plan for the repayment. However, keep in mind that the shorter the Loan tenure is, the more is the EMI, you need to pay each month; while the longer is Loan tenure, the less is the EMI, incurred. However, in such case, a person need to pay more interest on the Loan amount borrowed.
There’s a tax benefit associated with the personal Loan. If you use personal Loan for the renovation or for the construction of home, or even to cover the down payment of home, you can avail a tax deduction of up to 2 lacs for the interest part in that financial year applicable under section 24B. However, for this purpose, you need to furnish relevant documents showing the usage of the money for that purpose, only.
Fixed Rate of Interest
While, some Loans are flexible in nature, the interest charged on the personal Loan is completely fixed. Thus, you are always aware of what EMI will be needed at the month end. Remember that in most cases, the personal Loan interest rate is fixed for the entire duration of the Loan tenure and thus offers you a relaxation; with no worries on interest rate changes.
Lower Rate of Interest than some other Loan types
While, home Loans and some other Loan types, can be availed at lower rate of interest, there’s Loan types, like business Loans and Credit Card Loans, which are expensive than the Personal Loans. So, if you are really stuck in your Loan requirement and need urgent financial help, personal Loans are the best option. If your credit score is really excellent and your income is on the higher end, with your job stable, the chances are that you will get the personal Loans for as low as 12.5%. So, check with Deals of Loan to know, the exact interest rate for your personal Loans by furnishing the relevant information.
Schemes and offers
There are numerous banks and financial institutions which keep on announcing special schemes and offers for personal Loans with time and again, for professionals like CAs, Doctors, Architects and others! So, keep an eye on those offers and discounts,; you might end up in getting a very good deal on Personal Loan.
The Personal Loans can be fruitful for Debt Consolidation, too. With the lower interest rates, as compared to some other Loan types, you can use the Loan amount of Personal Loans to consolidate the high interest debt. Considering the high interest rate of Credit Cards, Student Loans, and business Loans, you can pay off the debt of those Loans, with the use of Personal Loan Amount.
In such a way, you can save money on interest and will help you in paying off, what you own, quickly.
Also, offering another advantage is, with this process of debt consolidation, you are combining all other Loans into a single umbrella and helping you a lot in analysing and paying off EMIs better.
You can better keep a track of your account and can save a good amount as interest in the longer run!
Boost your Credit Profile.
Are there any other benefit attached with the Personal Loans, especially after there are so many mentioned above? Yes, of course! There’s another benefit associated with the Personal Loans. All has been discussed, except your Credit Reputation.
With any Loan you borrow and pay off well, in a timely manner and responsibly, it gets highlighted in your Credit Profile.
In fact, if you carry your task of repayments responsibly, you are collecting reward points for your credit Profile, and it gets highlighted in your credit score as calculated by CIBIL.
What’s the use of this Credit Score? This credit score is the one, which decides your Loan application approval or disapproval. While, Loan types such as Personal Loans are the unsecured Loans, the lending agencies rely on your credit history and job stability together, to judge if you should be approved or not!
For those, who were having a bad credit history, can improve their Credit Score, with the Personal Loans, by paying off EMIs at regular time.
Even, personal Loans can be used to establish the credit history of a person. It has been seen that the People have no credit history at all, due to the absence of any credit cards activity and Loans activity. With personal Loans, people have a great chance to establish a credit history of theirs!
Eligibility Criteria required for Personal Loans
However, to avail such a huge list of benefits for Personal Loans, you need to get accustomed to the eligibility criteria required to avail Personal Loans. Since, the Personal Loans eligibility criteria is very relaxed, one needs to fulfil the basic eligibility for availing Personal Loans:
The minimum age required is 21 years, while the maximum is 60 years to avail Personal Loans.
There’s a variation in the eligibility criteria of different banks; while, some banks consider RS. 15000 as the minimum income required, some other banks have their bracket starting from as high as 20k INR; while there are fe names, who look towards 30k INR as the minimum Salary required for the successful Personal Loan Application. You can contact Deals of Loan to seek out help in this regard!
A Person needs to be in job for at least 2 years to successfully apply for the Personal Loans. A Person needs to be working with the current employer for at least 6 months before applying for the Personal Loan. Also, stability in your job is preferred by the lending agencies!
Many banks consider approving the Personal Loans Application of the applicants, with the credit score as low as 350, while, there are some who look for at least 600 Credit Score, as an successful eligibility criteria for the Loan Application.
Before you Borrow
Consider, whether personal Loan benefits can really work for you. Before you really go for the Personal Loan application process, reconsider if your finances are really set, so that you can pay off EMIs for your personal oan easily and successfully. Before you borrow, reconsider al available options. Even if the Personal Loans are instant helping hand for your financial needs and demands, you still have to pay interest.
You can adjust your expenses, and can research on what other options can be used to coup with the current financial crisis. While, Personal Loans are seriously a very helpful Loan option available with all people, its better you never come into such a situation where you are in need of the credit from Banks and other financial agencies. Better be ready for emergency conditions, and start collecting money as emergency fund to use, during the emergency needs. Always avoid in getting debt and adjust your budget, in whatever, you earn! Try increasing your income and avoid all undue expenses. Also compare offers of different banks and financial institutions, before opting for the one. Any minor change in interest rates on Personal Loan can save you a real handsome amount of money being paid as Interest!
In fact, the internet accessibility has eased out the complete process of the Personal Loans. Gone are the days, when a person needs to knock at the doors of the banks and financial institutions to avail Loans; today, with the accessibility of internet to all the corners of the country, the applications for the personal Loans have gone online and with the easy and quick application, the person can get the Loan amount within minutes or within 245 hours in their bank account.