A Personal Loan is an excellent boon for individuals who need money but do not want to borrow from their family and friends. Such a Loan helps you address your immediate needs. It is also usually easy to avail them of. Let us understand more about Personal Loans, the documents required to apply, and their benefits.
Understanding Personal Loans
As mentioned, a Personal Loan is an unsecured credit. Several banks offer it in India. This Loan does not need any security or collateral and is generally provided with minimal documentation. You can utilise the funds for any legitimate purpose. However, like any other Loan, you need to repay it according to the terms agreed to with the bank. This is usually done with the help of easy equated monthly instalments.
These EMIs usually depend on factors like Personal Loan interest rate, the amount you borrow, and the tenure.
Documents needed for Personal Loans
When you opt for a Personal Loan, you need certain documents. This document can vary across banks. However, the essential ones generally include:
- Proof of identity
- Proof of residence
- Proof of identity, like salary slips, ITR forms, and Bank Account statements.
- A completed Loan application form
- Necessary KYC documents
Benefits of opting for a Personal Loan
Personal Loans offer multiple benefits:
- When you apply for a Personal Loan, banks typically provide the flexibility to select the Loan tenure. This lets you opt for a Loan term based on your repayment capacity. When selecting, it is a good idea to choose a shorter term. This helps you save on the interest payment and repay the amount faster.
- The Loan amount is usually disbursed quickly. However, your preferred bank should be convinced of your repayment capability.
- A Personal Loan needs minimum documents.
- Since this Loan is unsecured, you also need not offer any security or guarantee against the sum you borrow. Consequently, you can skip the risks associated with losing your asset if you default on the repayment.
- When you apply for a Personal Loan, you can utilise the funds you receive for any legitimate purpose. For example, use the funds to cover the cost of your higher education, pay for a medical emergency, go for your dream vacation, renovate your home, and more. Banks do not have any restrictions on the end use of the funds unless you utilise them for unlawful activities or illegal purchases.
Conclusion
As evident, Personal Loans offer multiple advantages. Today, you can also conveniently apply for it online and utilise it for immediate monetary needs. So, compare the various Loan offers from numerous banks and opt for a suitable one for your immediate money needs.
