One of the fastest ways to get cash for different expenses, be it a vacation, weddings, honeymoon trips, medical emergencies, home renovation, or consolidating debts, are Personal Loans. It is an unsecured loan that banks do not ask security for, and the documentation process is easy and minimum. You only need to make sure you fit the Personal Loan eligibility before starting the application process.
However, it is ideal for research before you apply for Personal Loan. Here is a guide on how to get one from the bank:
Check affordability
The only thing you do not want when you take out a Personal Loan is unable to repay them. While the bank does its due diligence by verifying the repayment capacity, it is better to make sure that you can pay the equated monthly instalments. For this purpose, use the Personal Loan EMI calculator for deciding the EMI you want monthly.
While you cannot predict the interest rates and the bank tenure, be aware of the minimum and maximum rates, tenures, and play around with them for gauging a basic amount you need to pay.
Check the credit score
This is an important step in the Personal Bank Loan process. All ask you to provide the credit report so that they can decide your repayment behaviour. The scores enable banks to check if you have defaulted on the previous loan payments, including the Credit Card dues. They get a fair idea of how you handle the dues from your credit ratings.
You typically need a score of 750 and more for the loan approval. If the score is below 750, banks offer higher Personal Loan interest rates.
Compare banks
You must select a bank that offers you the best interest rate possible. Precisely why, it is essential to compare the lenders and the loan type before approaching one. The best idea is to open for the bank with whom you have a working relationship that lets you negotiate the loan terms and interest rates, and the chances of approval are high this way.
Begin the application process
This is where all the action starts. Once done with research and finding the lender, start the application process. Fill and submit the application for an online Personal Loan or visit the bank branch for beginning the process.
Provide documents
The Personal Loan documents are minimum, and so you might be asked to provide a PAN card, Aadhaar, and other address and employment proofs.
Wait for disbursal
The bank notifies you when the loan gets approved by offering details of the amount, interest rates, and tenure. Most banks today disburse these loans immediately, especially if done online. Some other do so after two to four business days.
