How to apply Personal Loan Online?

Personal Loan  Updated date : January 6, 2018 172

Purposes for Which You can take a Personal Loan

Since the name itself is personal loan it may be taken for variety of personal reasons. The best part is you do not have to disclose the reason for taking the loan even to the bank or financial institution as it is a personal loan. There are plenty of purposes for which a personal loan can be a good idea. For example for travel plans, for wedding, to support medical emergencies, for education, to renovate your house etc.

Following are the sub categories for which you may apply for personal loan :

Loan for Supporting Weddings:

You may take a personal loan to support you own wedding. In India it is very prominent reason for taking personal loan as the “big, fat Indian wedding culture’ is known to all the financial institutes. They will offer you wedding loan start from buying the jewelry to support the wedding events.

Home Renovation Loans:

Banks does provide personal loan even for renovation of the home. These loan are tailor made as per your requirements.

Vacation/Travel Loans:

Holidaying is becoming expensive by the day. As new horizons beckon, the wanderlust in you would love to go places. Personal Loans for travel are now part of the portfolio of most lenders.

Debt Merging Loans or Debt Consolidation Loans:

A debt merging loan helps you to syndicate many different liabilities under one umbrella. Merging makes it easier for you to manage your liabilities. Instead of many EMIs, you pay just one. Besides, you can gain cheap interest rates as well.

Loan for Higher Education:

Education is costly and not easily available to everyone. Therefore, education loans are very important. Almost all banks in India offer education loans and the demand has remained steady.

Always Check the Ability of Repayment

Instead of going ahead & taking personal loan for your need it is most important for you to check if you would be in a position to repay the personal loan through monthly EMIs or not. Now a days every financial transaction that you make can be track thanks to CIBIL score. So, make sure to go ahead with the loan amount which can be repaid every month without delays as the failure of monthly EMI payment will affect your CIBIL score badly. It is very important for you to check the ability of repayment before deciding the loan amount. The EMI of your loan must not be more than 30 to 40% because there must be many other expense to meet up every month. And if you do not have many expenses to meet every month you will surely not be in need of personal loan! If you already have an ongoing loan (S) than try to accompany your existing loans with your future loan because this will ease your life a lot. Do not forget to keep the loan repayment duration in mind as you will have to plan the expenses as per that.

Eligibility for Personal Loan

Both banks as well as non-banking financial institutes provide personal loan. It is very essential to remember that no matter for which bank of financial institute you are applying for personal loan there are several basic factors which are considered by all the banks & financial institutes. Following is the general eligibility point to take care of:

Monthly Income :

For most banks & financial institutes the minimum monthly income limit for personal loans is Rs. 50,000 . The monthly income limit is higher in bigger cities as the cost of living is also high in these cities.

Criteria for Salaried Applicants:

Personal loan can be availed by both salaried as well as self-employed. When it comes to the personal loan application of a salaried person the employer plays an important role. If you are working at central, state or local government offices or departments than taking personal loan would be very easy for you. Secondly even of you are working in private firm but the firm is well known than it will ease the process. You should be working at least since past 12 months with your current employer.

Criteria for Self-Employed Applicants:

Self-employed person can also take personal loan as easily as salaried person. The requirement for documents will definitely be different for both applicants. If you are a business man or self-employed, your business should be at least a year old & should making profit in that past one year. The criteria for business turnover will be different in different banks & financial institutes.

Age:

Generally the minimum age limit for applying for personal loan is 21 years & maximum age limit is 60. Many banks & financial institutes have altered the upper & lower limit of the age of the applicant. The age is considered just to make sure that you are at the age to repay the loan.

Do remember that sometimes even though you fit in all the eligibility criteria still bank does not grant you a personal loan. This will be happening because banks does not allot personal loan to the personal living in the area which has higher rate of nonpayment.

Documents Required for Personal Loan :

The documents required are very simple when it comes to personal loan application. The list of required documents is very prescience & the process for personal loan is very simple & easy. All you need is the documents to support your eligibility:

1. Filled application form for personal loan
2. Passport size photo
3. Valid Proof of age (birth certificate/ Scholl or collage mark sheets/ passport/ voter’s ID/ driving license/ PAN card/ Aadhar card)
4. valid identity proof (passport/ voter’s ID/ driving license/ PAN card/ Aadhar card)
5. valid address proof (latest utility bill/ ration card/passport)
6. Documents of income: Salary slip of last 3 months, 6 months bank statement, form 16 of current year & the offer letter of current employer in case of salaried person. In case of self-employed income tax return & profit & loss & balance sheet of last 2 years, last 6 months bank statement & business proof.
7. Proof of continuity of business for self employed

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Loan Query / Support / Feedback

    Can I get a personal loan with a CIBIL default? by Mira Mishra:

    Getting a personal loan with a CIBIL default is difficult, but possible. Personal loans are unsecured loans which do not require any collateral or mortgage- hence, lending institutions seek some other form of assurance that the loan will be repaid. Your CIBIL Score, which is a quantification of your financial trustworthiness based on your past repayment history is what they assess in this regard. Now, with a past instance (or instances) of repayment default, lenders get wary of granting a loan (especially an unsecured loan) to an individual. Hence, you will have to step very carefully at this stage as a rejected personal loan application can further reduce your CIBIL Score.

    To get a personal loan with a CIBIL default, you will have to ensure that your present monthly earnings are high. With increased income, chances of missing payments and defaulting get lowered. You can also apply for a joint personal loan with your spouse or any other closely related family member who has a good CIBIL score; their higher CIBIL Score acts as a compensatory factor for your application.

    Alternatively, you can also look for lending institutions which grant personal loans to individuals with a low credit score. However, you need to be informed here that such lending institutions charge a much higher rate of interest. It is best to stick to credible lenders like banks and NBFCs which have a good credit rating.

    If nothing else works, you can try for a secured loan if you own any asset of value that can be used as collateral for the loan.