Personal Loan

Features and Benefits of  Personal Loans :

Personal loans are the preferred loan option to raise funds for life goals and financial constraints as they are easily accessible, require minimal documentation, and are available for faster disbursement.

 The main features and benefits of personal loans are:

Unsecured loans No end-use restrictions Loan amount is up to 4 million rupees but may be exceeded at the lender's discretion Repayment period is up to 60 months (can be exceeded on an individual basis) Many financial institutions offer top-up loans for additional needs Minimal documentation work Fast disbursement

Types of Personal Loans:

 Apart from the regular personal loan programs, several banks and NBFCs offer a range of personal loans to help customers meet their unique financial requirements. The extensive features offered in these loan variants, such as tenure,  fees, etc., are almost the same as regular personal loans.

 Here is a brief look at some of the personal loan options:

•  Instant Loans

•  Short Term Personal Loans

•  Pre-Approved Personal Loans

•  Personal Loan Balance Transfers

•  Personal Loans for Education

•   Increasing Personal Loans

Here's a detailed overview :

1.      Eligibility Criteria  :

•    Age: Generally between 21 to 60 or 65 years old.

•    Income: Minimum income requirement varies by lender.

•    Credit Score: A good credit score (typically above 650) enhances your eligibility.

 2. Types of Personal Loans  :

•    Unsecured Personal Loan: No collateral is required; interest rates are generally higher.

•    Secured Personal Loan: Requires collateral (like FDs, gold, etc.); lower interest rates.

3. Documentation Required  :

•    Identity Proof: Passport, PAN card, Aadhaar card, etc.

•    Address Proof: Utility bills, Aadhaar card, etc.

•    Income Proof: Salary slips, bank statements, Income Tax Returns, etc.

 4. Loan Amount and Tenure  :

•     Loan amount varies based on income, creditworthiness, and lender policies.

•     Tenure typically ranges from 1 to 5 years, sometimes up to 7 years depending on the lender.

 5. Interest Rates and Charges  :

•    Interest rates can be fixed or floating, based on market conditions and lender policies.

•    Besides interest, consider processing fees, prepayment charges, late payment fees, etc.

 6. Approval and Disbursement  :

•    After submitting the application and necessary documents, the lender evaluates your eligibility.

•     Upon approval, the loan amount is disbursed directly to your bank account.

7. Repayment  :

•     Repayment is through EMIs (Equated Monthly Installments).

•     You can choose between post-dated cheques, ECS (Electronic Clearing Service), or direct debit for EMI payments.

8. Usage of Funds  :

•  Personal loans can be used for various purposes such as weddings, medical emergencies, home renovation, travel, debt consolidation, etc.

9. Prepayment and Foreclosure  :

•     Some loans allow prepayment with minimal charges, while others may have penalties.

•     Foreclosure (closing the loan before the tenure ends) may also attract charges.

 10. Additional Considerations :

•    Credit History: A strong credit history improves your chances of approval and favorable terms.

•    Comparison: Compare interest rates, fees, and terms across multiple lenders to find the best deal.

•    Negotiation: Negotiate with lenders for better terms based on your creditworthiness and relationship with the bank.

   11. Insurance  :

•  Some lenders offer optional loan insurance to cover outstanding amounts in case of unforeseen circumstances like death or disability.

 12. Impact on Credit Score:

•   Timely repayment boosts your credit score, while defaults can negatively impact it.

   13. Tax Implications  :

•     Unlike home loans, personal loans do not offer tax benefits on interest payments.

•    Navigating the personal loan process in India requires understanding these factors to ensure you choose a loan that fits your financial needs and can be comfortably repaid within the specified tenure.

Why should you take a personal loan from Ars Financial Service? 

When looking for a personal loan, potential borrowers should compare offers from as many lenders as possible. While you can visit various banks and NBFCs' websites individually to check for personal loan offers, checking through an online financial marketplace like Ars Financial Service makes the process quicker, easier, and more convenient. There are several other reasons to apply for a personal loan through Ars Financial service.