Financial institutions offer different types of loans to help you meet your monetary requirements. Most credit facilities like home or auto loans may be used for specific purposes.
These types of loans are offered by banks and non-banking financial companies (NBFCs). However, these may not be beneficial in meeting emergency financial requirements, such as medical expenses or funding a wedding.
Such fund requirements may be met through personal loans. These types of loans may be used for any legal purpose and are available at affordable interest rates. Here are five benefits of personal loans.
The borrowed money may be used for any purpose like taking your dream holiday or funding your wedding. The lenders do not limit the use of the money, thereby providing you with flexibility.
Lack of collateral requirement
Most personal loans are unsecured and do not require guarantors, which means you do not have to keep any security against the loan. The application is approved on the basis of factors, such as your income, credit score, age, and employment history. This ensures you do not face the risk of losing your personal asset in case you are unable to service the loan in a timely manner.
Different lenders offer various loan tenures when you apply for a personal loan. The Equated Monthly Installment (EMI) schedule is calculated on the basis of the borrowed amount, loan tenure, and interest rate. The tenure varies from one year to five years, thereby ensuring you do not face any financial constraints while repaying the amount.
Quick and simple procedure
The entire procedure of availing of personal loans online is simple and quick. The lenders require minimal documentation and no collateral, which makes it easy for you to meet the loan eligibility criteria. Most lenders sanction the loan and disburse the amount within a few days.
Higher loan amount
Lenders offer high loan amount based on your eligibility and documents. You may apply for a loan ranging from a minimum of INR 50,000 up to a maximum of INR 10 lakh. This will enable you to meet all your fund requirements without facing a liquidity crisis.
Leading banks and NBFCs offer these credit facilities to borrowers. Most lenders offer quick approval which provides immediate cash to meet your requirements. In addition, lenders allow you to foreclose the loan before maturity without paying huge penalties.