Personal loans are unsecured loans that can be used for several purposes, such as weddings, higher education, debt consolidation, medical expenses, and other expenses of personal nature. These loans are repaid monthly for a few months to several years. It could take longer, depending on your situation and payment diligence. These loans are also called instant loans, which you can get online.
Several statistics show that the number of people applying for an instant personal loan in India has increased in recent years. After all, personal loans are simple to obtain, require no collateral and have reasonable interest rates. Notably, they do not have any end-use restrictions.
Common Uses of Instant Personal Loans
- Home Renovation
- Debt consolidation
- Paying for wedding costs
- Paying for one-time purchases and travelling expenses
- Paying for a medical emergency
- Purchasing big-ticket items, and so on
Things to remember before you apply for an instant loan
Here are five things you should know before applying for instant personal loans online.
- Determine the exact amount you require and the total repayment cost you can afford: Your debt-to-income (DTI) ratio can be used to determine your affordability. The ratio is a part of your monthly income that goes toward debt repayment.
- Determine your loan eligibility: You must fulfil certain criteria if you want a lender to approve your loan. The criteria include age, employment status, financial situation, and identity.
- Examine the offers from your preferred lenders: Once you’ve determined the loan amount you need, look into the offers and benefits your preferred lenders are offering.
- Read the loan terms & conditions carefully: Spending time on this step can save you a lot of stress later. Check for prepayment and foreclosure fees, interest rates and late fees, EMI bounce fees, loan cancellation fees, and other fees.
- Plan your repayment carefully: You don’t have to sweat it out on paper anymore, making calculations to plan your repayment. You can easily calculate your Loan’s EMI using a Personal Loan Calculator available on the websites of top lending institutions.
Benefits of Instant Personal loans
- Loan Disbursement: Instant personal loans are unsecured credit facilities NBFCs and financial institutions offer to meet personal financing needs. However, there is a significant difference when it comes to disbursement time. Instant Personal Loans are approved and disbursed quickly. They are ideal when you need money quickly and cannot wait for days.
- Information Availability: Today, searching for any query or information online is common. Lenders now have websites providing complete information about their products. This information includes the fees associated with their products, interest rates, loan eligibility, and personal loan requirements. All this makes it easier for borrowers to make a decision.
- Complete Privacy: When taking an instant loan, the borrower’s data remains private as documents are submitted online without manual intervention. New-age lenders have strict privacy policies and are committed to protecting their customers’ privacy.
- No physical paperwork: No physical paperwork is involved in the instant loan application process. As mentioned in this article, anyone can easily apply for this loan online. You simply need to upload the documents and your application form on the lender’s website. The basic personal loan requirements are identity proof, address proof, and proof of income.
- 24×7 Support: The online process enables anyone to apply for a Personal loan even at midnight or on a bank holiday. One can apply online using their laptop or smartphone. What’s more, the lenders have a 24×7 customer support system to handle queries and complaints of the customers.
A personal loan can be the best funding option if you research, assess your needs, and plan your repayment. Lack of collateral, ease of access compared to other loan options, appealing interest rates, and many other factors make Personal Loans a favourable finance option for salaried and self-employed individuals.
Personal loans are an excellent way to consolidate debt and make large purchases. When you take a personal loan to pay off debts or plan the perfect vacation or wedding, you borrow money that you should repay in EMIs.
Remember, regardless of the circumstances, the personal loan should be repaid within the agreed repayment tenure. Otherwise, it may affect your credit score.