Personal Loan in India

A personal loan is an unsecured type of loan provided by Banks and other Financers to salaried and self-employed individual without taking any collateral. A personal loan (PL) is also referred as signature loan as financers provide these loans only on the basis of signature of a borrower on documents with a promise to repay the loan along with interest as per the repayment schedule. Financers offer personal loan to individuals on the basis of their net monthly income, stability of income, credit/CIBIL score and overall credit profile. Minimum CIBIL Score required to take this type of loan varies with different financers but a score of 750 and above can help you to get a better deal for interest rate and loan amount.

Salaried individuals often take personal loan to take care of their emergency need of funds, it can be availed quickly say within 1-3 working days by providing basic information of a loan applicant, salary slips, form16/ ITR along with bank statement of salary account to the lender with duly signed loan application form. The loan amount varies from as low as Rs. 10, 000 to as high as Rs. 100 lakhs for a tenure in the range of 1 to 5 years. If you are a looking for a personal loan urgently, you can apply online at My Mudra FinCorp.Com by providing your basic information and submitting the required documents online, you have an option to compare offers from different financers before submitting loan application form. We can assist you to take an instant personal loan with complete digital process for sanctioning of the loan application. MyMudraFinCorp assist you to take personal loan from leading providers including personal loan HDFC Bank, Personal Loan ICICI Bank, Personal Loan Bajaj Finance, Personal Loan SBI, Axis Bank and others. Salaried individuals can take a PL loan to meet their emergency requirements of funds like medical emergency in family, a family holiday, home renovation, a marriage in family etc. Self-employed individuals and professionals often take Personal Loan to meet their short-term & emergency requirement of funds in business.

Personal Loan Eligibility Criteria

Before applying for a personal loan, you need to make sure that you're eligible for it. Different financial institute follow different eligibility criteria. The criteria common for most banks includes:

Criteria Description Salaried Individuals Self- Employed Professionals
Minimum Age 21 years 23 years 23 years
Maximum Age 60 years 65 years 65 years
Net Income per Month Rs. 15, 000 Rs. 25,000 Rs. 25,000
Working Experience 1year 2 years 2 year
CIBIL Score 650 700 700
Min Loan Eligibility Rs. 50,000/- Rs. 50,000/- Rs. 50,000/-
Max Loan Amount 45 lakhs 25 lakhs 45 lakhs

Personal Loan Benefits and Feature

Personal loan offers come with many attractive features and benefits to make it easier for a wide range of customers to borrow with ease. These are as follows:

1. Personal Loan Amount:

The minimum and maximum loan amount offered by different financers under the personal loan product varies from as low as Rs. 10,000/- to as high as Rs. 100 Lakhs. The loan amount a personal loan provider will offer a borrower depends on the repayment capability, repayment history on loans, credit cards and stability of your income & employment. Personal loan policies of the lending banks also depend on the risk-taking appetite of the bank, that’s the reason you will see your loan eligibility varies from one lender to another lender.

✔ Tips for Higher Personal Loan Eligibility:

If you are looking for a higher loan eligibility you should go with higher tenure loan which goes up to 60 months. You can also pay off your shorter-term loans and credit card outstanding’s before applying with a personal loan financer.

2. Personal Loan Interest Rate:

The minimum rate of interest financers offer for personal loan is 10. 75 percent and it goes up to as high as 32 percent. The rate of interest a lender offers to a particular borrower depends on overall profile of the borrower which includes the company a borrower is employed with, net salary, other running loans/obligations, repayment history on existing loans and CIBIL or Credit bureau score.

✔ Tips to Get Better Interest Rate for Your Personal Loan

If you are looking for a higher loan eligibility you should go with higher tenure loan which goes up to 60 months. You can also pay off your shorter-term loans and credit card outstanding’s before applying with a personal loan financer.

3. Personal Loan Tenure:

Financers are offering flexible tenures for PL loan, depending upon a loan applicants age at the time of applying for the loan & income. Banks & NBFCs offer a tenure from 12 months to 60 months.

✔ Tips to get a Higher Tenure for your Personal Loan

If you want to keep the EMI of your loan lower, than you should opt for a higher tenure loan and if you want to minimize the interest outflow on loan than take a smaller tenure loan.

4. Quick Processing Period:

Turnaround time or processing period for a personal loan varies from 2 to 5 working days based on availability of your documents and your overall profile.

✔ Instant personal loan at quickest possible time

you can get a quickest loan by applying online with MyMudra.com and submitting all the required documents completely, your loan can get approved the same day and the disbursal can come into your account in 1- 2 working days.

5. Personal Loan Processing Fees:

Processing fees ranges from 1% to 3% of the loan amount plus GST as applicable. The processing fees a lender offers you on your personal loan depends on the employer you work with, your income bracket and your overall credit profile.

✔ Tips to Get Lowest Processing for your personal loan:

Before Apply for a personal loan compare personal offers from all the top lenders with processing fess offers. Apply online at MyMudraFinCorp to get the lowest processing fees.

6. Foreclosure charges on Personal Loan:

Financial institutes charge an early closure fees/penalty in the rage of 2% to 4%, depending on the numbers of EMIs you have paid after taking disbursal of the loan and before you apply for the foreclosure of the loan.

✔ Tip To get Minimum or No Foreclosure Charges:

Before taking disbursal of your loan check with your lender if there are any foreclosure charges on loan or the same can be waived off. There are very few lenders like Axis Bank which does not charge you any pre-payment penalty on your personal loan after you have paid a specific number of EMIs.

7. Flexibility to use the loan amount take as personal loan:

A financial institute gives you complete flexibility & freedom to use the funds raised by taking a personal loan. Funds can be used for multiple purposes.

✔ Tips for End use of Personal Loan:

  • Family Wedding: funds borrowed as personal loan can be used for wedding of a family member or friend or self, loan amount can go as high as 100 Lakhs for a tenure of up to 5 years.
  • Purchase of consumer goods: loans can be taken for the purchases of consumer durable goods like TV, fridge and other household gadgets.
  • Higher Education of a family member.
  • House renovation
  • Medical emergency in family
  • Family holiday in Europe or US or other exotic location.
  • Construction or purchase of a residential property where home loan may not be sanctioned because of unavailability of certain legal or technical documents or approvals.
  • Using personal loan to buy a car or an imported bike, either because of cheaper interest rate and flexible repayment period in personal loan than a car or bike loan.
  • Debt consolidation- closing your multiple loans and or credit card outstanding’s which may be running with higher interest rates than the personal loan rate of interest.
  • Paying off loans taken from taken from friends and family
  • You can also take a personal loan the use it for all the above purposes.

8. No Collateral Security Required:

A personal loan is unsecured in nature; it simply means a lender offers it to a borrower without keeping any fixed or movable asset as collateral/security. It is sanctioned only on the basis of financial statements and repayment capacity of the of a loan applicant along with repayment track on loans/cards.

9. Personal Loan Repayment:

Since it is offered for a fixed term it’s also called as a term loan. Term of the loan is fixed at the time of sanction of the loan and it is in the range of 1 year to 5 years. The loan is repaid using EMIs (Equated monthly installments). An EMI consists of two components: one is principal amount and the other is interest charged on current outstanding amount. Initially, when you start repaying your loan, the interest component of the EMI is higher and principle component is lower. As the loan matures, the interest component keeps reducing and the principle component increases.

10. Basics about a personal loan EMI

  • Higher EMI : If tenure is short, the EMI amount is higher
  • Lower EMI :If term is long then the EMI is lower
  • Interest Rate: Lower the interest rate, lower will be the installment 
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