The Basic Of Borrowing Personal Loans In India

If you are contemplating for a personal loan to address your particular needs, you should better consider some important things before you go for it. In fact, borrowing a personal finance is neither difficult nor easy. It largely depends on the factor of whether or not you have totally complied with terms and conditions associated with it.

The basic guidelines to borrow a personal finance in India -

Study Eligibility Criteria

More often than not, borrowers do not prioritize studying eligibility criteria of lending institutions for a personal finance. Leading Indian finance institutions like State Bank of India, Axis Bank, CitiBank and HDFC Bank have set of approved eligibility criteria for personal finance. For instance, HDFC Bank in India does not consider a borrower with poor financial condition and bad credit scores. It demands salary slip, bank account statement and other income sources to assess the gravity of your repayment capacity against the finance you wish to borrow.

Common eligibility criteria include consideration of following things.

Age

Net Monthly Income

Status of a borrower (salaried or self-employed)

Repayment capacity (on the basis of current income)

Notable things to follow

Do not take personal finance if it does not include following features and benefits;

Does the amount of loan fully meet your personal requirements?

Does your bank qualify you for taking out special loan meted out for doctor, engineer or chartered accountant?

Is repayment tenure agreeable to equated monthly installments (EMI)?

Study personal loan interest rate carefully. Not all the banks can offer you loan on same rate of interest rate. Go for the lowest rate of interest.

Is loan amount sufficient to address your needs?

Does acquisition of loan include compulsory show of down-payment?

Secured Or Unsecured Personal Loans?

For the borrowers with poor credit scores, unsecured personal finance is an optimal choice while secured finance is good for those with good credit history and excellent financial condition. You should better study your current financial situation. This will help you prioritize either of the given options.

Also, unsecured loan includes higher rate of interest as compared to the secured one. This will apparently make borrowing a bit expensive for you if you go for it. However, it is good if you do not wish to pledge collateral to your lender. Collateral is a compulsory requirement in the case of borrowing secured personal loans.

Documentation

Typical of all the Indian banks demand necessary and complete documents from loan applicants. Whether you are salaried or self-employed applicant, the rules associated with submission of documents requires total compliance anyhow.

Common documents to submit include the followings;

Income Proof - Salary slip, bank statement, balance sheet etc.

Residential Proof - Voter-id card, PAN card, ration card etc.

Age Proof - Voter-id card, driving license, birth certificate etc.

Business continuity proof for self-employed applicants

Nationality proof for both salaried and self-employed applicants

Therefore, borrowing a personal finance in India is largely dependent on compliance of terms and conditions together with consideration of key things beforehand. Do not forget to research well to choose a reputed lender/bank. Always be honest in submitting required documents. Study application form carefully. You should also prioritize your needs before you go for the loan.

A decision of taking personal finance after careful analysis of all the key factors is surefire way of getting best deal. If need be, you can ask tips from financial experts to choose a best individual finance for your needs.

A personal loan applicant should adhere to compliance with terms and conditions associated with acquisition of personal loans in India. This essentially calls for close consideration of many key things beforehand for a borrower.