There might be times when an individual needs extra funds to meet expenses. The individual may have to reckon with costs that are related to vacations, home renovation, educational courses, medical emergencies, and many more. A personal loan is going to help an individual to meet the expenses without them dipping into their savings or disturbing their current investments.
Features of Unsecured Personal Loan
Personal loans are the loans that are taken so that the individual can meet their needs for personal expenses. The advanced loan is dependent upon the individual’s ability to repay the loan and credit history. Many features help to make unsecured personal loans attractive.
These features are:
Personal Loans are collateral-free: Unsecured personal loans do not require any guarantor or collateral. There is no need for evaluation of assets that are required for the pledging of collateral. It helps in the reduction of time of processing as well as paperwork.
Personal Loans are approved instantly: Since there is no requirement of collateral, the time used for processing gets shortened. Several NBFCs or non-banking financial companies disburse money into the individual’s account within 24 hours.
Flexi loan facility: NBFCs offer Flexi a personal loan facility, which allows the individual to borrow the money when they need and prepay when they can. The individual can borrow as per their need and does not need to utilize the whole loan facility. The interest is going to be applied only on the borrowed sum. The individual can make part-repayment without him/her paying the penalty.
Nominal Interest Rate: Unsecured personal loan is accessible at a nominal rate of interest for the chosen tenor. For example, if an individual wants to take a loan of Rs. 1 Lakh, suppose for a tenor of 12 months. At the rate of interest of 14%, the total payment is going to be Rs. 107746. The EMI of the individual would be Rs. 8979. The EMI for interest-only personal loans will amount to be Rs. 646 approximately.
Minimum Eligibility Criteria: For most of the lenders, the personal loan eligibility criteria is minimum. These criteria include:
- Employment Status
- Good credit history
- Minimum net salary per month
Minimum Documents: Some of the basic documents that are required to avail personal loan are
- Bank account statements of previous months
- Salary Slips
- KYC documents, and
- Employee id card
Flexible Tenor: Many of the lenders provide wide tenors to the borrowers to repay the money. The tenor generally ranges from 12 to 60 months. Personal loans are thus really helpful when an individual needs it immediately so that he/she can meet any of their expenses. It is vital to have good credit. Flexible repayment and borrowing help to make it an attractive loan option.