LIC Agent in Nagpur

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Personal Loan

A personal loan is a short to medium term unsecured loan (no collateral) that you can use to meet current financial needs. Though most commonly used to meet expenses related to debt restructuring, vacations, unexpected medical expenses and down payments, a personal loan may be used for practically any type of expense. If one looks at the benefits of personal loans, one can start with the fact that the tenure of a personal loan is shorter as compared to a mortgage. Unlike mortgage, which is for ten, twenty, perhaps thirty years, a personal loan is commonly for between one and five years.

Why Choose a Personal Loan?

There's no limit to the number of ways a personal loan can be put to use. It can be taken for any personal reason, such as:
Personal loans act as the best-suited option to smoothen up cash flow at times of stringency. The key reason for some to prefer a personal loan is because of minimal documentation, fast processing times and the flexibility for use of the loan. Witnessing the huge potential of this market, leading banks and NBFCs in India are offering personal loans to both salaried and self-employed individuals.

Points to Consider before Applying for Personal loan

To choose from the best personal loan offers is important, but equally important are numerous other factors that should be taken to prevent personal loan becoming the burden causing a big hole in the pocket. Here are some points you must never overlook while applying for personal loan.
  • Plan your budget and stick to it: borrow only the amount you need and use it towards your planned expenditure
  • Check your credit report or CIBIL score
  • Repayment period of personal loan can be between 1 year and 5 years
  • Know your APR (Annual Percentage Rate) i.e. How much the loan would cost in interest per year. Personal Loan Interest rates can range from 11.49% to 35% depending upon the individual applicant profile and the lender. Suppose you take a personal loan of Rs 5 lakhs for 3 years at an interest rate of 11.50%. Then, your EMI amount will be Rs 16,488, while you will make a total payment of Rs 5,93,568 over the 3 years. The processing fees on personal loans are usually charged as a percentage between 1% and 6.5% of the loan amount. So, in this case, your processing fee could vary from Rs 5,000 to Rs 32,500. For more details click on the comparison tab.
  • Do a complete and detailed market survey of the various Personal Loan options like their interest rates, the pre-payment charges levied, and any other terms and conditions.
  • Look for zero processing fees and zero-penalty for pre-payment option. In case this is not available, then prefer borrowing with lowest cost. Sometimes additional costs add up and make a huge difference even after you are offered lower interest rates
  • Look for payment delivery charges such as early payment charges.




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