Procedure For Comparison Of Personal Loan Online
Banks and other NBFCs offer loans for variety of purposes
. Most of the loans that are offered by both banks and NBFCs are secured by pledging collateral. These loans include home loans, automobile loans including car and two wheeler loans and other mortgage loans. One common feature among the above types of loans is that they are all secured against property both movable and immovable. These types of loans are also advanced for specific purposes and they cannot be used for other purposes. It is illegal to use specific loans for purposes other than specified.But there are other loans which are cannot be put under any specific bracket are advanced under personal loans by most banks and financial institutions. There is no need to pledge collateral in case of personal loan.
Personal loans are given to borrowers in order to meet significantly large expenses such as home renovation, meeting wedding expenses, festival expenses, medical expenses, holiday or vacation expenses, buying consumer durables, etc. All these expenses can be met by taking personal loans.
The amount of personal loan advanced to borrower will depend upon factors such as gross income and the net income of the borrower, pre-existing loans, if any, the amount of EMIs being paid on those loans, credit worthiness and credit history of the prospective borrower. All these factors are clearly studied by banks or NBFCs before advancing personal loan.
The interest rate on personal loan is higher in comparison with other types of loans. Lack of collateral security makes personal loan vulnerable and puts it in high risk bracket. This is one of the major reasons for the high interest charged by banks and private institutions. In case of banks, the interest rate can be between 14-24%. But, in case of NBFCs and particularly private institutions and lenders, the rate of interest is very high which can range between 24-36% in some cases.
In some cases, banks and NBFCs charge additional charges for processing the loan request. Usually, the price of the processing fee is charged on percentage basis on the entire amount. The percentage can range between 0.5% to 1% on the amount of loan.
Some of the best personal loan schemes can be found in banks. Some banks charge less interest in comparison with other banks and NBFCs. One can avail these best personal loan schemes through online.
While applying for personal loan, one should not depend on one bank. Instead, one should apply in different banks. By applying in different banks, borrower will be supplied with information from banks about his/ her eligibility, interest rates, number of EMIs and pre-payment penalty rate, etc. After obtaining this information, borrower can choose the best loan plan. In this way, one can avoid paying high interest rate and high pre-penalty rate.
Another source to know information about personal loans is from the internet. One can also apply for online personal loan. By applying for an online personal loan, borrowers can acquire loans very quickly than through conventional means. Online personal loan schemes are being introduced by banks and by finance retailers who help in processing your loan request. These finance retailers also provide online personal loan calculators through which one can check for the best personal loan plans or schemes by comparing loans, interest rates and EMIs from different banks and NBFCs.
After initial inquiry and choosing the best personal loan, borrower will have to submit documents such as proof of identity, proof of residence, employment and income certificate, IT returns, bank statements, etc. These documents are used to ascertain borrowers financial description and in loan advancement.
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