What Is Personal Loan? Should You Get Personal Loan?

What is personal loan?

Personal is a type of loan in which you don’t need to give anything for getting a loan for example if you want to get home loan then you have to give your home’s papers as a security but in personal loan you don’t need to give any security to the bank for getting personal loan, and this is the reason why personal loan’s interest rate is always high. In personal loan you get the loan approval in minimum time even in 30 minutes after applying for personal loan. The interest rate of this loan is about nearby 10%, and you don’t need to provide so many papers for getting personal loans this is also the good benefit of personal loan, if you want to know more about the personal loan then you can search more things on google.

Credit History Should Be Good For Getting Personal Loan

So first of all if you don’t know what is credit history then first let me tell you about the credit score and then I will tell you that why credit history is important for getting loans. So credit history is nothing, it’s just a history about how much loan you get in past and have you return the loan money of time or not? and do you know that if you want to get a credit card then you also need a good credit score for example you need a minimum 750 credit score for credit card easily and different banks have different rule, so you also need a 750 credit score or more then 750 because it is a good credit score, and you can get personal loan easily if you have maintained the credit history.

Tenure For Personal Loans?

So like other things let me first tell you about what is tenure in loans? So it is a time period in which you have to return the loan amount money which you have taken from the banks, and if you will ask to me that how much time we get in personal loan then the time for returning the loan amount in personal loan is 1-6 years and different banks have their own rules for tenure. Now let me tell you about how you will give the EMI of your loan, so there is so many methods but in todays life there is a method which name is auto debit and this is the method in which EMI will automatically deduct from your bank and you have to fill the form for this method.

How Much Loan Amount Can I Get For Personal Loan?

So minimum loan amount you can get in personal loan is 50,000 and the maximum amount you can get in personal loan is 25 lakh, so please get the loan if you can refund it on time because if you will not able to return the loan amount then they will definitely try to decrease your credit score, and that can you effect in your future, so please get the loan for fear use and when you need money immediately then get the loan, because this is not good decision if you will get personal loan for just wasting it, if you think about this then the personal loan take so much interest to you, and if you will take the other loan like personal loan or car loan then in that type of loans you will get the lower interest rate then personal loan.

Eligibility For Personal Loan?

So there are so many factors on which bank give you the personal loan and some of are:

  • First thing they will see that you are employed personal or not and if you are employed then how much income are you getting from your all sources and they really want to see that how much EMI can you give for example if your income is 20,000 then you can pay EMI of 10,000 and this is also the main factor which bank check before giving personal loan to anyone.

  • The main thing is credit score that I have already told you above, now you know that how credit score is important for you to get personal loan.

  • They will also check your assets & liabilities like they check do you have more assets or liabilities, if they found that your liabilities are more then your assets then maybe they will not give you the loan.

Is Personal Loan Is Good In Comparison With Other Type Of Loans?

No, because if you want to get something then you can get loan on that because, you have to pay higher interest in comparison with other loans, for example if you will get the loan for car then you have to give less interest then the Personal Loan.

If you will think that why this happen that let me tell you that in personal loan you don’t need to give any big security it’s mean they are taking very big risk and that is the reason why they charge more interest on the personal loans. For example in July, 2022 the banks are charging something 12% interest on personal loan and if you will get the car loan then you have to give only something 7% interest. So now you have understood that which loan is better for you. 

Now let me tell you that why people get the personal loan, so sometimes they need the loan for the work on which they can’t get the loan for example wedding, or investing in there own work, so mostly companies don’t give the direct loan on these type of works so that’s why people get the personal loan with high interest rate.

What is Lock-In Period In Loan?

So the lock-in period is the period in which you can’t repay the loan and close the loan, let’s understand it with the example like you are getting the personal loan and the you have now the full money with interest and you want to repay the loan in just 2 months then the bank will not allow you this because they want to earn more interest on the loan that’s why they set the lock-in period and that’s why I want to tell you that before getting the loan please ask all the important question related to loan.

The lock in period in maximum banks have around 3-12 months but if you want to get the loan without any lock in period then maybe you have to face some problem because mostly banks set there lock-in period. I also want to tell you that some people also take the loan for using that money in there agriculture so if you are one of them then you have prefer the banks which is made for specially agriculture like NABARD(National Bank For Agriculture & Rural Development).

Now do you know that how you can get a minimum interest rate? or how you can decrease the interest rate while getting the loan? If you don’t know then don’t worry about that you just need to do is maintain your credit score. Let your credit score is some bad and you are going to get the personal loan then do you know that your interest rate will be high then other peoples. This happens because they see your credit score and if they found that your credit score is bad then they increase the interest rate and if they found that your score is good then they think that there is no more risk to give you the loan.

Where From You Should Get Loan, Bank or Finance Company?

First of all I want to tell you that you should compare the interest rate of the loan which you want to get for example if you are planning to get the personal loan then you should compare the loan interest within the banks and the finance company. Then you can decide from where you should get loan, and if you are seeing that every bank and the finance company is giving the loan on the same interest rate then I will recommend you to get the loan from your own bank means that bank in which your bank account is available.

Now do you know that if you will get the loan from that bank in which your bank account is available and in that bank account you receive your salary or receive your payments if you are a business man or professional then you will get the personal loan easily because they are seeing your bank account and they can easily decide that how much amount they can give your anything that they want to know about your income, but if you don’t have the bank account in which you receive the salary then you can not easily get the loan in comparison with previous situation.

Is Private Banks Good For Personal Loan or Government Banks?

So if you have decided that you will get the loan from the bank not from the finance company then I will recommend you to please get the personal loan or any type of loan from the government bank because in todays the private bank are playing mind game with the people let me explain you how they will show you that they are giving you the loan on very minimum interest but they will recover that amount from the processing charges and another charges, so be fool ask everything about the loan while getting the loan and if you found that they cheated you at any stage then go and complain a file against them.

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