Blog #personalloan

This means that with a personal loan you can use the funds to meet any financial obligation from financing a wedding, meeting emergency payments, or planning a vacation abroad personal loan. The only task before your personal loan is to pick a personal loan that suits you best. And while competition among lenders is high for personal loan there are ways to narrow down the list. Here are 5 factors to pay attention to personal loans so that you can be sure of choosing the best personal loan for you. The interest rate is a vital aspect to consider when you are searching for the best personal loan or any other loan. It directly affects the amount of interest you pay and therefore determines the affordability of the personal loan. 

Personal loan interest rates are set by the lender-based personal loan on factors such as your credit score and repayment ability. Personal Loan Eligibility Generally, individuals with a higher score are considered a more reliable personal loan. However, if your score is sub-par, lenders are likely to offer you a lower sanction, personal loan, or even reject your application or any other loan.

You can check affordability simply by making use of an EMI calculator personal loan This tool accurately computes your monthly payments and even shows you the total personal loan interest that you will pay towards the personal loan, therefore allowing you to pick the right personal loan.

Additional fees and charges
Before settling on a loan, it is imperative that you check the fees personal loan apart from the interest rate. Depending on the lender, these may be highly personal loans and you may end up spending more than you intended to. So, don’t pick an option simply based on a low personal loan interest rate and ratings. Consider factors like processing fees, bounce charges, personal loan penal interest, and secure fees as well as personal loan.

Ensure repayment
To have the best borrowing experience, ensure you have a flexible tenure for repayment of personal loans. Personal loan Sometimes, can be stringent and you may end up paying up more than you save. Enquire on SBI personal loan about the costs to avoid paying hefty charges in the future personal loan. Enquire about the costs to avoid paying hefty charges in the future personal loan. This aspect is not surprising, considering the several benefits of a personal loan and the features it carries.. Personal loan Versatility in usage stands at the core of a personal loan. From paying for your home-renovation, personal loan, much-coveted vacation, medical emergencies to wedding costs, a personal loan can truly serve you well.

Conclusion 

While getting a personal loan is simple and convenient, personal loan you must also make sure that you obtain it from a viable lender and personal loan You must evaluate several aspects before making the right choice and Read on to know the different factors that you should consider when picking a personal loan lender in banks.

WHAT IS A FAIR CREDIT IN A PERSONAL LOAN?

A personal loan can help a person with a whole variety of financial problems and various financial challenges. If a person is in need of some cash in order to cover a large expense or have to pay a medical bill or has to consolidate the balance of his credit card, he can always look upto a personal loan. This is because a personal loan can help a person in all of the circumstances mentioned above and not only this but a lot more. 

A personal loan is an installment loan, which means that a person has to repay the amount of loan back to the bank or to the money lender in the form of equated monthly installments and at the same time, it is an unsecured loan which means that you do not have to pledge any of your assets. Hdfc personal loan customer Care helps the customers to clear all the doubts regarding a personal loan.

Also, a person does not have to get the perfect credit to get a personal loan but if the credit of the person falls into the 'fair' category, he may find fewer loan options and will also have a more difficult time in getting a personal loan with the favourable interest rates than a borrower which has a higher credit score. If a person is considering a personal loan and his credit is in the 'fair' zone, then he can even improve his credit score in a lot of ways.

A FICO score of around 580 to 669 is considered 'fair'. FICO ranges from a minimum of 300 to a maximum of 800 and it mainly falls into the following five categories: -

• Very poor - 300-579
  
  
• Fair - 580-669
  
  
• Good - 670-739
  
  
• Very good - 740- 799
  
  
• Exceptional - 800-850.

Your FICO scores are based on the information that is in the credit reports and it is maintained by the three major credit reporting agencies which are - Experian, TransUnion and Equifax. Your FICO score depends on the following five factors: -

• PAYMENT HISTORY- How consistent a person is in paying the bills and the other dues is the most important factor in maintaining a good credit score. This factor mainly counts for around 35% of the FICO score. It means even if you have missed a single payment of the credit card dues or the EMIs, it will have a huge impact.
  
  
• AMOUNTS OWNED- The balances of the credit card divided by the sum of all the available limits of the credit cards gives the credit utilization. This is one of the most important factors to consider and also, along with this factor, how much the progress is made by paying all the loans, accounts for around 30% of the credit score. In simple words, the lower your credit utilization, the nearer you will be to pay off your cards and it will be better.
  
  
• LENGTH OF CREDIT HISTORY- Around 15% of the credit score is based on how long a person has held his loan accounts and his credit cards. This is also one of the most important factors and it also considers the average age of all the accounts of the applicant.
  
  
• CREDIT MIX- The seasoned credit users manage to have a variety of the credit products such as the credit cards, loans, lines of the credit card, etc.
  
  
• NEW CREDIT-  The remaining 10% of the credit score is based on the number of credit accounts that a person has opened recently and how many hard inquiries have been there to the credit report. A flurry of the new applications of the credit can also increase the risk of a person to the money lenders.
  
  

CONCLUSION: -

When a person applies for a credit, the banks or the money lenders use his credit score to assess the risk that is involved in lending you the money.  A higher credit score indicates that a particular person is managing all his credits easily and is also repaying all the debts successfully.

Read More:- Loan Against Property vs. Personal Loan 

The covid 19 was initially started on 31/12/2020 by the WHO(world health organization ). Later on 30/1/2021, the world health organization considered covid 19 as a world health emergency issue. on 11/3/2021 the WHO considered it as a pandemic.

In India during the pandemic, the govt and few banks introduced special loan schemes for people in need of emergency money.

1. IND- COVID Emergency Credit Line (IBCECL) for Corporate: this will provide 10% of the working capital and has a limit of 100 crores.

2. SHG-COVID - SAHAYA LOAN for Self Help Groups: these loans were provided for the self-help group (SHG).

3. IND- MSE COVID Emergency Loan— (INDMSE-CEL) for MSME: this will provide 10% of the working capital and has a limit of 50lakh.

4. IND-COVID Emergency Salary Loan for Retail borrowers: the salaried people will be given a loan amount up to 20 times their gross salary per month.

5. IND COVID- Emergency Pension Loan for Pensioners:15 times the pension that he receives and with a max limit of 2 lakh.

During the lockdown, the financial market resulted in an acute financial crisis. For the people who already had loans debts upon their heads, had a hit as they were in no situation of paying the money, as they were on the brink of being unemployed .as entire financial make was impacted by the total shutdown of its operations, due to coronavirus, it took its time to come back with help for the people.

Along with the risk of not being able to pay the repayment EMI. The people who have taken the personal loan had a greater risk of losing the credit score. As a personal loan has a higher risk factor, it reduces one credit score when one doesn’t pay the EMI. Vijaya Bank personal loan also provided financial help during the pandemic season.

Did covid really affect personal loan?

Higher Default Possibility :During the lockdown and the pandemic, people started losing a job and they started becoming unemployed - as the company were unable to keep up with the salary of every employee as most of the company were running on loss due to many factors like lack of customers etc. Due to non-payment of loans - the number of bad loans increased rapidly as a result of covid 19. As a result of the pandemic the economic growth slowed.

Should You Worry About Your Personal Loan Repayment? 

In the repercussion of the coronavirus lockout, it all comes down to two things: job protection and revenue. If your source of income is consistent, repaying your personal loan EMI will not be a problem. However, since the existence of the COVID-19 pandemic is unknown, if you decide to pay your EMI late to save money or for other financial reasons, In addition to the interest, you will be charged a late payment fee. On the other hand, those who are uncertain about their job security or who have lost their job due to the coronavirus will find it difficult to repay their personal loans. You may get a new personal loan or a personal loan moratorium in this case.

About Personal Loan Moratorium 
As announced by the RBI, the borrowers who already have an existing loan on the 1st of march - who have at least one payment due -can explore an EMI moratorium till august 31 2020. After applying with moratorium no amount will be deducted from the borrowers account for three months also will not affect the borrower’s credit score.

Conclusion
Covid 19 affected the entire profit organizations and non-profit organizations. As a result, the people started losing their jobs and becoming unemployed, this affected the loans as people were unable to pay the EMI of the existing loans.

Read More:- Gold Loan Vs Personal Loan 

A personal loan is an unsecured loan that can be used for various purposes like weddings, higher education, vacation, funerals, parties, birthdays, business, renovation, designing, medical emergencies, asset buying.construction, furnishing, electronic gadgets, and/or any other specific or general purpose. This loan can be legally availed using a bank or Non-Banking Financial Companies(NBFC). Both online and offline services are available and instant disbursal of the loan is a gigantic advantage.

Factors To Be Considered Before Going For A Personal Loan:-

• Eligibility Criteria: A loan albeit easy to avail still requires certain criteria that an applicant needs to meet before he/she becomes a borrower. The applicant must be at least 18 years and at most 65 years to avail this loan in most banks and NBFCs. The applicant must either be a salaried individual or a self-employed individual(business professional). Joint applications are acceptable. The applicant must have been working for a minimum of 2years and at least one year with the current employer. If it is a business, the business should be running successfully for a minimum of 2 years. The bank or NBFC needs certain documents like ID proof, income proof, address proof, employment proof, bank statement to validate the eligibility.

• CIBIL Score: Credit Information Bureau (India) Limited (CIBIL) is a credit company that maintains the personal information, banking, and employment information in addition to the past credits(loans or debts) of individuals, companies, corporations, societies, and every other banking professionals. The report is summarized by a three-digit number known as credit or CIBIL score that plays a vital role in determining one’s eligibility to avail a loan. And for unsecured loans like personal loans, the score is a tad bit more essential. The number if above 700 is a good one and below 600 is a bad one. So check your CIBIL score and know if you can apply for personal loan and if so how much money can you apply for the loan.

• Principal Amount: The amount a bank or NBFC grants you a loan is the loan amount or principal amount. For a personal loan, the amount goes to a maximum of Rs 50 lakh in most banks and financial institutes. The loan amount depends greatly on the CIBIL score and your monthly income. A high income grants you more loan amount and vice-versa.

• Tenor: The tenor of the loan is the period you can avail the loan for. The tenor for a personal loan varies from 1 year to 5 years in most banks and NBFCs but some financiers offer more tenor than that. The repayment term should be carefully chosen. A long tenor usually means a low-interest amount each month till the end of a tenor but the total interest amount is more than a short tenor with high monthly instalments every month.

• Interest Amount: Equated Monthly Instalment(EMI) is the interest amount as a borrower you will be paying for the loan amount you availed till the end of the tenor. The personal loan interest rate varies from 7.5%-20% per annum depending on the loan amount, eligibility, CIBIL, tenor among others. Before availing the loan you should compare the interest rates from one financier to another carefully. And after availing the monthly instalments should be paid on time.

• Additional Charges: Banks and NBFCs charge additionally for the taxes, processing fee of the application among others. The processing fee is incurred for the approval and the processing of the application. It usually goes up to 2.50% of the loan amount. Therefore make sure that the lender you take the loan out on doesn’t bill you immensely. ICICI personal loan is an illustrious loan with the most reputed offers and high-end customers availing loan without hesitation proving their trustworthiness day by day.

Read More:- Can a salaried person obtain a Personal Loan? 

Personal loan has emerged to be one of the most important loan forms. Most of the people in the times of financial crisis tend to go to banks and non-banking financing companies(NBFCs) to take personal loans. Dena Bank personal loan can be applied through an online website or the nearest bank branch. The minimum age requirement for availing personal loan at dena bank is 24 years. The bank also offers reasonable interest rates and processing fees on personal loans. One can apply conveniently for personal loan at dena bank and avail various schemes and offers. The bank is recommended for taking a personal loan. For more information regarding the personal loan one can visit the online website or apps of the bank and Non-Banking Financing Company(NBFCs). 

Personal loans can be availed from private as well as public banks. One needs to submit proper documentation to avail personal loans. There are many schemes offered by various banks and financing companies on personal loan which one can avail. There are various schemes offered by the central government on personal loan that an applicant can avail.

Various Schemes Offered By Banks And Financing Companies Are Listed Below:-  

• One can get a lot of discounts when one applies for personal loan during festive seasons. There are various schemes offered by the bank and non-banking financing companies(NBFCS) during the festive seasons. The festive season schemes can Benefit the borrower in many ways. The financing companies offer discounted rates during the festive season. One can opt for the schemes while availing personal loans. Also many lenders offer lower interest rates on the loan during the festive season. One can easily avail personal loans at a lower interest rate during the festive season. Some lenders may also waive off the processing fees during festive times. One can avail personal loan and can save a lot of money. The special offerings can be enjoyed by the borrowers during festive times. 

• There are various schemes offered during covid on personal loans. Many people were severely affected due to coronavirus nationwide lockdown. Many people lost their jobs. Even so many companies were shut due to this pandemic. The Repayment tenure on the personal loan has been increased including the moratorium period. Many banks are offering pensioners of the bank personal loan to need their needs during difficult times like the covid-19 pandemic. Many government and public banks and also non-banking financing companies(NBFCS) are offering various schemes like lower interest rate, increased tenure on the personal loan. Both salaried and non- salaried people can avail the personal loan. One can easily go to the bank to avail these offers and enjoy additional schemes during the covid-19 pandemic.

• Various government schemes are provided by the bank which one can avail during the pandemic. Center has come with various schemes on Personal loan which can support small works, businessmen or people who lost their job due to the pandemic. One can easily take help of these schemes in meeting daily requirements during this pandemic. The government schemes were provided for people who were facing difficulties in the time of the pandemic. One can easily avail various discounts on personal loans just by applying at any public bank. 

As we all know that as a country we are going through a pandemic which has affected the livelihoods of so many people around the country. Many banks and non-banking financing companies(NBFCS) have come up with amazing schemes which can be availed during a pandemic. The center has also come up with various schemes for people who lost their jobs, migrant workers and many other people affected due to the pandemic. One can avail the schemes offered to the government from any public banks all over the country. For more information regarding various schemes on personal loans one can refer to this article.

Also read this: Personal Loan Insurance 

Personal Loans can prove to be extremely beneficial in fulfilling the needs of the borrower. These loans can be used for several purposes and the application process is also very easy. These loans are unsecured and thus offer a lot of benefits and require very little paperwork and documentation. Keeping in mind the unsecured nature of these loans, the banks and financial institutions charge a high rate of interest on loan amounts from the borrower.

Personal loans can be availed by people both by online and offline mode. The time duration for the processing of the loan application can take up to around 14-21 days. Online applications can take a lot less time than that. In general, the interest charged by banks and various financial institutions charges a rate of interest starting from 8.95% per annum. The applicants can apply for a loan amount up to INR 50 Lakhs based on certain criteria. The loan tenure offered by banks can go up to 7 years. Processing fees for the application process generally range from 0 to 3% of the loan amount plus the applicable GST.

The application status of Personal Loans can be checked via both online and offline modes. This enables the applicant in getting updates about the application status. Personal Loans have become quite popular among the people of India in the past few years. These loans can be used for the personal needs of a person like wedding ceremonies, home renovations, business investment, education, etc.  

Eligibility Criteria

To be eligible for a Personal Loan, the following requirements is needed to be fulfilled by the applicant:

• If salaried, the applicant should be above 21 years of age and below 60 years. In the case of self-employed applicants, the applicant should be at least 22 years old and below the age of 55.
  
  
• The net monthly income of a salaried applicant should be INR 15 thousand and the net income for self-employed applicants should be INR 25 thousand.
  
  
• The CIBIL score of the applicant should be at least 750
  
  

The application process involved for Personal Loans is quite simple and easy and does not require a lot of effort from the borrower. The Banks do not demand any asset from the borrower as security and hence the Paperwork and documentation involved in the process are very less when compared with other loan policies. This is why many people prefer Personal Loans over other Loan policies due to the benefits that personal loans offer.

Document Required

The following documents are required for the application procedure of 

Personal Loans:

• Proof of identity of the applicant
• Passport-sized photographs of the applicant
• Proof of Residence of the applicant
• Proof of income of the applicant
  
  

No security is required for the application procedures of these loans unlike Home Loans, Car Loans, Gold Loans, etc. 

Multiple repayment options are also available for the borrower to repay the loan amount. Online payment is also accepted by several banks and financial institutions. An online Personal loan emi calculator can be used to make an estimate about the monthly EMI that needs to be rapid to the bank. These calculators require details like the loan amount, rate of interest, and the tenure of the loan.

Some of the popular Personal Loan schemes offered by Banks and other financial institutions in India are:

• State Bank of India Personal Loan
• ICICI Bank Personal Loan
• Bank of India Personal Loan
• Bank of Baroda Personal Loan
• Axis Bank Personal Loan
• TATA Capital Personal Loan
• Fullerton India Personal Loan

The very fact that personal loans do not require any asset from the borrower as security makes it a pretty good option for borrowing money from the lending organizations. These have been used by many customers of banks and financial institutions at times of need. The amount borrowed can even be used for medical emergencies and hence have saved several lives in the past.

 Also read this: Gold Loan Vs Personal Loan 

Compared to all or any of the loans, a personal loan is just one that sometimes features a higher rate of interest, which successively can increase your Equated Monthly Instalment (EMI) burden. Therefore, some like it better to cover the personal loan before the tenure ends. This is often referred to as over-payment of the loan. Under this process, you save on the EMIs and therefore the interest that you simply pay with the principal amount within the end of the day. Before you opt to cover it, you would like to hunt permission from the lender, while in some cases, lenders also charge foreclosure penalty charges, if you pay the loan before the agreed tenure. The bank levies a penalty to catch up on the loss of interest amount.

There are 6 Things when over an personal loan would be a wise decision.

Reduces your debt burden: If you've got adequate finances to pay the loan amount before the loan tenure ends, you'll do so. However, you would like to possess a word together with your bank on whether or not they charge any penalty for over. The over facility reduces your debt burden; hence it might be an honest option for your financial health.

No impact on your credit score: The ICICI personal Loan doesn't affect your credit score.

Avoid over of the loan in the latter stages: When your applied personal loan is within the latter stage of repayment, then it wouldn't be a wise option to cover it. you'll be unable to accumulate enough savings and you'll even have to face penalty charges. Analyze before choosing over your consumer loan within the latter stages.

Think about the charges: Once you initiate the over of a loan, the bank levies a penalty of fifty once a year of the outstanding amount and other applicable charges.

Personal loan part-payment: If the ICICI personal loan borrower wishes to scale back the monthly installments and therefore the tenure of the personal loan, he/she can choose a personal loan part payment. The part payment amount is going to be subject to the terms and conditions as set by the financial lender.

Regular personal loan over A regular personal loan over is when the borrower clears all the EMIs. Following the payment of the last EMI, the borrower has to intimate the lender to issue the No Objection Certificate for the over of the loan and finally the loan over the certificate.

Over loans may or might not be the proper step. you would like to research your financial situation before paying off the whole loan amount directly. you'll initiate the over of a Personal Loan online by visiting the official website of the ICICI bank.

Partial advance payment of the loan

1. There are cases where you'll be eligible for a bonus or windfall from another source that you simply would like to use to pay off your loan. However, the quantity might not be enough to pay off the whole loan. That's once you can choose the partial prepayment of the loan.

2. There will even be some penalties involved within the partial prepayment of the loan. get on the lookout for them. Lenders also can restrict frequent partial advance payments and should allow only a limited number of them. Each of those conditions varies between lenders, so it's good to see them before making advance payment.

3. This can also not end in the closing of your ICICI personal loan account. you'll have a couple of more EMIs left after you partially prepay the loan, which you'll get to pay off immediately.

Conclusion
Over ICICI personal loans may be a relatively simple process as you do not have any assets pledged with the bank which require to be released. Over your loan is a crucial duty that shouldn't be neglected at any cost. remember the procedures involved in properly closing your loan to avoid any problems associated with your credit.

Also read this: PERSONAL LOAN AND THINGS TO DO TO AVAIL PERSONAL LOAN