A Five-Step Guide to Obtaining a Personal Loan
Whether it’s a wedding, family emergency, travel, or unavailability of funds, obtaining a personal loan is the easiest and quickest way to get money. But steps and processes are still involved in getting your loan. It is recommended that you obtain complete information about the amount, duration, and procedure of the loan so that you don’t face obstacles while obtaining a personal loan that suits your interests best.
What is a Personal Loan?
A personal loan is also known as an instant loan or instant personal loan. It is a loan that you can obtain at a fixed rate of interest from a financial platform or financial institution, such as a bank. This can be obtained to meet personal financial needs such as a wedding, education, or any other emergency.
Personal loans are typically referred to as “unsecured loans.” This is because applicants are not required to provide any collateral or security in exchange for the money borrowed. Through EMIs, the borrower agrees to pay a fixed rate of interest over a set period.
Benefits of Obtaining a Personal Loan
There are many benefits to personal loans. This includes their adaptability, accessibility, and hassle-free application process. A personal loan is a fantastic option to pay for your urgent needs. A personal loan can be used to cover all of these expenses, whether they are related to an unexpected medical issue or a large purchase.
- Fast Approval
In most cases, it can be done in as little as 24 hours!
Obtaining a personal loan takes far less time than processing a home loan. A home loan can take 3–4 weeks. They’re best for quick cash or payment demands. You should maintain a solid credit history (a CIBIL score of more than 750+). In this case, lenders will approve your loan application without any hassles.
- No collateral is needed
Uninsured loans, like personal loans, don’t require collateral. Personal loans are easier than mortgages, auto loans, etc.
But as a borrower, you should be aware that unsecured loans pose a greater risk to lenders. So interest rates are typically higher to offset this risk. They are typically 1.33% or higher per month.
- Increases credit rating
If you have a history of poor credit or no credit history at all, then there is a fantastic technique for raising your credit score. This is to obtain inexpensive personal loans and make your repayments on time. As you complete all of your EMI payments on time and at the predetermined interest rate, your credit score will go up.
- Limited documentation and simple availability
The fact that there are few documentation requirements for online personal loans is one of their main benefits. Only three documents are needed. All of these can be filed online.
A Step-by-Step Guide to Obtaining a Personal Loan
Thinking about taking a trip abroad or maybe organizing the ideal wedding? Make use of a personal loan to achieve your goals.
A personal loan typically does not demand collateral or security and has flexible repayment periods.
The five stages for obtaining a personal loan are listed below. We’ve got all the information you need, including what paperwork is needed and how to apply, to make obtaining a personal loan easy.
Step 1: Identify your needs
Determine your requirement for obtaining a personal loan and your required loan amount. You might require a loan, for instance, to pay for your wedding or to repair your house. You might only require Rs. one lakh to Rs. ten lakh.
Step 2: Verify personal loan eligibility
You should ascertain your eligibility after identifying your requirements. To find out how much you can borrow as a personal loan, use the personal loan qualification calculator.
Step 3. Calculate the monthly instalments / EMIs
For a rough estimate of your monthly loan installments, use an online EMI calculator. You can adjust the interest rate and term on the personal loan EMI calculator to match your income. All personal loans from HDFC Bank have affordable EMIs beginning at approximately Rs. 1878 (approx) per lakh.
Step 4: Head to the bank
There are several ways to obtain a personal loan from a bank. They are online, through Internet banking, at an ATM, or by going to a branch.
Step 5: Submit the required documentation
Next, learn what paperwork is needed for a personal loan. You will typically need ID proof, residence proof, and income proof (such as bank statements, pay stubs, or IT returns). Give the bank copies of your personal loan paperwork.
Await the transfer of funds to your account. Customers of most banks receive pre-approved loans in 10 seconds, and non-customers receive their money in 4 hours.
Final Words
So those are the five simple steps to obtaining a personal loan.
Looking to go in for a personal loan? Piramal Finance is an Indian financial services company. It is venturing into retail lending. This includes personal loans, business loans, housing loans, and other consumer-focused finance products.
FAQs
- What is the procedure for getting an instant loan?
If you are approved, the lender will usually respond within minutes and transfer funds into your bank account. However, even if you are authorized, it may take a business day or two, or even longer, to get the funds.
- What are the criteria for an immediate loan?
Instant loans are often not subject to a credit check. You must, however, give personal details, be at least 18 years old with proof of identity, provide evidence of income (e.g., a pay slip), and have a bank account.