At times of unexpected expenses like heavy medical bills, urgent home repairs, a sudden job loss or even a cost escalation on the wedding you were so looking forward to, personal loans can bail you out of a sticky situation.
So, how can prospective borrowers actually go about getting a personal loan in the first place?
Here’s a step-by-step guide on how to get a personal loan super quick and without any hassle.
Choose A Reputed Lender
While there is a vast organized and unorganized market of lenders, prospective borrowers would do best to choose a reputed lender. Not only would this help get a person the best deal in terms of interest rates but also make the whole process seamless, hassle-free and quick.
Before applying for a personal loan, borrowers should find out how much personal loan they are eligible for.
The eligibility will typically depend on some specific criteria including their monthly salary or business income, their currently active loans and EMIs as well as the combined outstanding amount on all their credit cards.
Basically, it will depend on how creditworthy a person is as a borrower.
Most regulated lenders allow borrowers to apply for a personal loan on their respective websites by filling up a simple online form.
All that people looking to take on a loan need to provide are their basic details. These include personal information like name, age, address, telephone number, PAN and Aadhaar card numbers, employment or business details, and information on their salary or business income.
Most lenders also provide their existing customers, especially those with a good credit history, with pre-approved loans that they can avail of within a few minutes.
Decide Amount and Loan Duration
Keeping their loan eligibility in mind, borrowers need to decide the amount of money they need to borrow and for how long. Personal loans typically carry a higher interest rate, and the rate also differs according to duration. So, one should strive to keep the amount and duration as low as possible, even if they are eligible to borrow more.
Borrowers can also choose repayment options, monthly or, if their lender allows them to, a more flexible option.
Most good lenders typically allow borrowers to apply for a personal loan right from the comfort of their home, by just logging on to their websites.
While some lenders deploy their executive to collect all the required documents from the borrower physically, a few lenders also allow the borrower to just upload the documents on their websites.
These documents can include one or more of the following—a copy of the PAN or Aadhaar card, salary slips or business income proof of the past six to 12 months, bank account statements of your salary or business income account for the last few months, a copy of company ID proof, if employed, and so on.
The documentation can vary from lender to lender. A borrowers may be asked to submit more documents. Since a personal loan is an uncollateralized loan, no collateral documents are required.
Once a lender approves the documents the loan amount will be disbursed to the borrower’s bank account in less a day.
So, this is how simple and easy it is to get a personal loan. The next time you are short on money, a personal loan can be your best friend.
Repaying The Loan
Typically, repayment plans require partial monthly repayments of both principal and interest amounts in varying proportions. A borrower can be smart about this and choose to clear the principal amount first, as that will lower the overall interest outgo, as the lender will not charge any further interest once the principal is paid off fully.
On the other hand, borrowers can choose to pay only the interest portion via equated monthly installments (EMIs) first and then the principal amount at the end of the tenor of the loan. This option helps those who cannot pay a higher EMI comprising both interest and principal for some reason.
Getting a personal loan is a simple and hassle-free process, at least as long as you have a good credit history and a healthy credit score.
Moreover, a good lender will also offer you an attractive rate of interest and will tailor your repayment plan in order to suit your cash flow position.
If you approach a reputable and well-managed lender like IIFL Finance, you can get your loan disbursed very quickly, from the comfort of your home.
In fact, IIFL Finance checks for a borrower’s eligibility for personal loans up to Rs 5 lakh within two minutes. The application is also simple and fully online. It even pre-fills the online form through Aadhaar data and allows you to upload your documents to sanction your loan within minutes. So, next time you need a persona loan, you know exactly where to go.