What is Personal Loan?
Unsecured Loan given by financial institutions to the customers for their personal needs is “Personal Loan”. The customers need not disclose the needs and the end use of funds.
As Personal Loan is a type of Unsecured Loan, the interest rate ranges between 12.50% to 18.00% depending on the customer’s credit history.
Benefits of Personal Loan:
- No collateral is required as personal loan an unsecured loan
- Financial Institutions doesn’t ask for or monitor the end use of funds
- Easy processing of application due to minimal documentation
- Tenure personal loan ranges from 12 months to 60 months
- Creditworthiness of the borrower is evaluated on the basis of its credit score, income, employment type etc.
Eligibility deciding criteria for Personal loan:
- Applicant’s age should be between 22-59 years
- Applicant should have a minimum salary of Rs. 15,000 per month
- Decent credit score
Documents required for availing Personal Loan:
|Identity Proof (Any two)||Address Proof (Any two)|
|PAN Card (Mandatory)||Utility bill (Example: Electricity bill, Telephone bill etc.)|
|Aadhaar Card||Aadhaar Card|
|Voting Id Card||Rent Agreement|
|Driving Licence||Lease Agreement|
- Loan Application form duly filled and signed
- Passport size photographs of applicant and all co-applicants
- Signature proof
Salary slip of last 6 months.
IT Return of last 2 years along with copy of Profit & Loss A/c and Balance Sheet.
IT return of last 2 years
GST Registration Certificate.
Form 16 of latest Financial Year
Business Establishment Certificate.
Banking of last 6 months
Banking of last 12 months
Employment Certificate from current employer
Charges for availing Personal Loan:
- Processing fees for personal loan ranges between 1% to 2%
- Foreclosure and pre-payment charges varies from financial institutions to financial institutions
Frequently Asked Questions:
1.What is the maximum funding I can get in personal loan?
The range of funding varies from customer to customer on the basis of their credit evaluation. Financial Institutions lends personal loan starting from Rs. 15,000 to Rs. 20,00,000.