Four Advantages of a personal loan

There are many options for the purpose of borrowing money, one of the most popular one is a personal loan. In comparison to other types of loans, a personal loan is not a secured one. This is because it is not meant for any commercial need rather person’s requirements. There are a number of things for which a personal loan may be used such as to purchase a vehicle, buying an electronic appliance, for a marriage, and similar reasons. A personal loan is approved based on a few factors which include the repaying capacity of an individual, credit history as well as source of income.

When you go to purchase a personal loan, you will be required to pay a certain amount of money along with a processing fee. The payment is then disbursed to the loan creditor. With regard to the payment of a personal loan, an individual needs to pay it in fixed instalments. These are paid with a specific interest for a particular tenure. Personal loans were not easily accessible in the past as they are now. Also, the amount of paperwork has reduced to a great extent. Personal loans are facilitated by various banks as well as financial institutions. In relation to other types of loans, personal loans offer a higher rate of interest.

If you are planning to buy a personal loan, here are some of the benefits you should know:

Agent

Unlike insurance plans or equity investment, you don’t need to approach an agent to buy a personal loan. This also helps you skip any kind of delays or interference. You can simply contact the bank or the financial institution.

Availability

As opposed to the myths of how difficult it is to get a personal loan, it is in very easy to purchase one. Most of the banks and financial institutions offer personal loans such as HDFC Bank, Axis Bank, and many others.

Amount

Every bank offers different amounts of personal loan. Most of the loans are offered in the range of Rs.15, 000/- to Rs.20, 00, 00/- The term of paying the loan is anywhere between 12 months to a period of 60 months.

Collateral

You don’t need to provide a collateral to secure a personal loan which is very important in other types of loans. In case of a personal loan, an individual’s capacity to repay is checked.