A personal loan is money borrowed for personal use in the marriage of family members, making purchases for wedding gifts, enjoying holidays, visiting resorts, arranging parties, etc. This loan can be obtained without any guarantee from anyone whatsoever. This is a kind of unsecured loan which is provided based on a person’s ability of repayment depending on his income. The value of money borrowed as personal loan ranges from 50,000 to 30 lakhs for a period of one to five years.
The personal loan is available on easy terms in the market, and many offers are made from time to time by the companies. You have to pay the processing fees and the prepayment penalty for this loan that ranges from 2-3%.
The eligibility criteria differ in various banks and institutions. The companies measure the ability of the person to repay the amount borrowed. The loan is given to self-employed and salaried individuals. The age factor, net income per month, and nationality are the three criteria that are considered by every private and public sector bank or financial institution.
The documents required for a salaried individual and a self-employed person are somewhat different. The documents required for a salaried person include identity proof, address proof; last three months bank statements, salary slips for last three months and two passport size photos. The list of documents required for a self-employed person has identity proof, address proof and date of birth proof besides income proof, office address proof, proof of the continuity of business, and last six months bank statement. A few companies may need additional documents.
You can borrow that much amount from the bank which you can repay. The EMI should not exceed 40% of your net income excluding the EMI’s of the other loans.
The interest rates on personal loan widely differ depending on the company and the candidate’s profile. The range of interest is from 14% to 26%. You can check our compare personal loan page to know more about the interest rates. Andromeda loans work with a broad range of personal loan providers to help you get the best deal.
The formalities associated with the personal loan are not stringent as with other loans, and the dispensation of these loans is comparatively easy. You need to collect the authentic documents required to complete the process as early as possible. You will get the loan immediately after the approval of the documents by the concerned authorities.
If you are a primary borrower, you can apply for a personal loan along with a co-applicant. Banks and financial institutions consider the eligibility of both the applicants for sanctioning personal loans. This will increase your chances of getting more amount as personal loan. Any person is not allowed to become co applicant, but your spouse, brothers, and parents can act as co applicants. There are many benefits associated with applying for a loan with a co applicant as if your co applicant has a strong credit history; you may be charged less interest rates on your loan. Apart from this, you will enjoy tax benefits under this joint finance system.
Read all the terms and conditions carefully before applying for any personal loan.
Outstanding Principle, Interest Rate (%), Tenure (in Months), EMI Monthly Breakup Chart