When in urgent need of money, getting a loan is what one usually thinks of. In times of urgency, opting for a personal loan is an ideal choice as it helps you cater to your instant cash requirements immediately. Whether you require funds for home renovation or a medical emergency or paying off outstanding credit card debt, a personal loan comes in handy to address emergency cash needs. Read on to know how a personal loan can help you meet your quick cash requirements.
What is a personal loan?
A personal loan is a type of unsecured loan that helps you easily meet your financial requirements. To avail this loan, you don’t have to keep any collateral or guarantor as the loan is sanctioned based on your eligibility. The lender provides you with the flexibility to use the funds as per your needs. The loan serves as a great solution for managing wedding, travel, home renovation, debt consolidation and other costs.
Eligibility criteria to get a personal loan
To get a personal loan, you must comply with the below eligibility criteria:
- You are a citizen of India
- You are aged between 21 years- 60 years
- You are drawing a minimum monthly salary of Rs. 15,000
- You have a good credit score i.e. a minimum of 650-700.
- You are employed with public, private or government entity
- The above eligibility criteria may vary from lender to lender
Documents required to get a personal loan
You will have to submit the below documents to get a personal loan
- Address proof i.e. Aadhar card, driving license, passport
- Identity proof i.e. PAN card, driving license, passport, utility bill
- Income statements such as salary slip or Form 16
- Bank statement
How does personal loan work?
A personal loan works just like other types of loans. You apply for a loan, the lender assesses your creditworthiness based on which the application is rejected or approved. If the loan application is approved, you get the funds directly credited in your bank account. On the other hand, with the rejection of the loan, you can try applying with other lenders or can reapply with the same lender after a few months.
Creditworthiness for a personal loan is determined based on various factors like your income, existing liabilities, credit score and others. Your credit score is a three-digit numeric score that reflects your credit behaviour. Having a high credit score increases your chances of getting your loan application approved at a low-interest rate. A low credit score is a sign of bad credit behaviour and can lead to getting the loan at a high-interest rate of rejection altogether.
Benefits of personal loan
Below are a few of the benefits of personal loan that makes it an ideal option to resort to in case of a financial emergency.
Instant access to funds: On successful approval, lenders now offer you instant access to money that makes it easy to take care of your financial hassles in an easy way. It also ensures you don’t have to wait longer for arranging the funds and can quickly handle any situation.
All-purpose loan: You don’t have to specifically give a reason to the lender as to why you wish to avail the loan. As the name suggests, the loan can be taken for addressing a personal emergency that allows you to utilize the funds for any purpose. You can use the funds for shopping, wedding expenses, travelling, debt consolidation, paying credit card bills and any other purpose.
No collateral: To avail an instant personal loan, you don’t have to keep any collateral as the loan is sanctioned purely based on your eligibility. This also saves your time by providing you quick access to money and ensuring you don’t risk your assets.
Flexible repayment option: You can repay the loan EMIs by opting for a tenure of 12 months- 36 months. Choosing longer tenure attracts low EMI, whereas short tenure attracts high EMI. This ensures that there is no pressure on repaying the amount as you can easily pay off the EMIs without straining your monthly budget.
Flexible loan amount: Depending on your requirement, you can opt for a loan amount ranging from Rs. 20,000- Rs. 2,00,000.
Increases credit score: Availing a personal loan helps you increase your credit score if you repay the loan EMIs on time. However, no repayment of EMIs reduces your score and prevents the lenders from offering you a loan in the future. Remember, having a low credit score can lead to loan rejection.
Conclusion
A personal loan can help you cater to your urgent financial requirements in a simple and hassle-free way. With the demand for loans on rise, getting a personal loan in Bangalore, Mumbai, Delhi and other cities has now become possible with online lenders offering instant disbursals. For instance, you can get a personal loan in Bangalore by Upwards. However, when getting the loan is important to check on the features and benefits to make the right pick.
