Emergencies never come with a warning. Most salaried people do not have the funds to fulfil their dreams or meet unexpected emergency financial requirements.
There is no need to despair. You can now take a step closer to achieving your dream by opting for a personal loan. These kinds of financial arrangements have versatile repayment options with tenures ranging from one to 5 years.
Personal Loan Features
- Quick and easy processing
- Minimal requirement of documentation
- Loan amounts starting at INR 50,000 going up to INR 15 lakhs
- Attractive and affordable interest rates
- Flexible repayment options
Personal Loan Eligibility
- Salaried Indian resident individual
- Age between 21 years and 58 years
- Employed in large private company or public sector
- Minimum monthly net income – INR 25,000
- Applicant should have at least completed graduation
- Minimum work experience – 2 years
When to avail such loans
- Financial crunch in the short-term; ideally less than 3 years
- Avoiding to avail of these loans from multiple institutions to prevent financial distress is important
- Never use these loans for funding acquisition of home or property
- Users should also not use personal loans for investing in the equity market
- To cover the expenses of a wedding
- Planning a trip with your family or spouse
- Finance required for home renovation
- Urgent requirement of funds for emergency situations
Types of loans
- Secured – Some institutions provide these loans by creating a charge on certain underlying security. The rate of interest on these is comparatively lower than the unsecured loans.
- Unsecured –When the loan is provided without taking charge on any asset, it is known as unsecured. Banks charge higher interest rate primarily because in case of default the recovery is tougher that significantly increases the risk exposure to the lending institution.
How to Get a Personal Loan
If you want to meet an emergency financial need, availing this type of loan is a possibility. Many people are not aware of the procedure on how to get a personal loan. Contrary to belief, it is not difficult to procure a personal loan. The stepwise procedure is discussed below:
- Contact the banks to know about the eligibility procedure, interest rates, and other terms and conditions
- After researching the different options, you can shortlist the ones that provide the best deal
- The applicants then need to submit their documents, such as address proof, income proof, and identity proof along with IT returns, passport, bank statements, salary slips, etc.
- The lending institution will physically verify your address and employment location as well as other submitted documents
- After verifying all the factors, the lender will issue a sanction letter and then disburse the loan
Caveats
There are several institutions that provide these loans and doing your research to understand about the different offerings is important. Certain factors you need to research thoroughly include features of a personal loan, interest rate on personal loans, and personal loan eligibility. Personal loans are expensive and when done irresponsibly can result in severe financial distress and debt traps.
Almost every bank in the country offers this product. Banks like Kotak, ICICI, Axis, HDFC, SBI, and many more provide personal loans. Most institutions have an elaborate and cumbersome documentation and eligibility process, which often deters users from availing such loans. With Kotak Bank, the entire procedure of availing a personal loan is quicker and simpler making it easier for people facing liquidity crisis to overcome their problems faster.
Sponsored post by Kotak Bank