Personal loans are necessary for the people who need money or the ones who do not have sufficient bank balances. Personal loans can be utilized for any of the purposes by the borrower according to their needs. The loans should be repaid on time by the borrower to avoid penalty being charged by the borrower. The loans taken can be helping individuals use the funds for emergency funding. Personal loans help boost the economy as many people fulfill their travel dreams or buy electronic goods for which loans can be taken at lower interest rates. There are multiple tie-ups for the retail chains with the finance companies which can provide loans to its customers at affordable interest rates and lower processing fees. The personal loans are not eligible for the income tax benefits as there is no provision for the income tax benefit being made available for the personal loan applicants. The loans are available at attractive interest rates to the borrowers. Personal loans are most commonly being taken by the people amongst the low-income groups or the ones amongst the moderate-income group.
Personal loans are also being taken and are beneficial by the people amongst the modest income group as these people do not spend their money from the past savings and instead prefer to pay the EMI’s for the loans. The bank also charges some processing fees for the approval of the loans. Also, there are tie-ups of the banks with the retail partners who can approve the loans of the electronic goods buyers with 0% interest rates and a certain amount of processing fees. Personal loans are necessary for many individuals who are falling short of funds and thus can satisfy their own needs through personal loans. The borrowers can take personal loans from any of the banks of their choice and also the ones who charge low-interest rates and also lower processing fees. Also, the borrower should read all the terms & conditions of the loans properly before signing the documents. The bank can provide the loans for the tenure of 5 years. The loans if repaid on time can help the borrower avail rebate on the loans. The borrower should have a proper credit score for the approval of the loans by the bank. The bank charges interest rates of 9-14% per annum to the borrowers.
Ways to get the personal loans approved:
Maintain proper CIBIL score:
The borrower should maintain a proper CIBIL score before the approval of loans. To maintain a consistent proper CIBIL score the borrower should pay the installments on time to avoid personal loans getting rejected.
Maintain sufficient bank balance for the approval of loans:
The borrower should maintain a proper CIBIL score for the approval of the loans. The person who maintains a proper CIBIL score is regarded as a financially stable person who can repay the installments on time. The borrower can set the auto-debit facility as well by signing the ECS mandate i.e: electronic clearance system for the auto-debit of loans.
Provide proper documentation for the approval of the personal loans:
The borrower should provide proper documentation in sequence. The borrower should provide all the necessary documents for the approval of the loans to the bank. Failing to submit appropriate proof related to the address proof, income proof to the bank. The approval process for the loans is easy for the personal loans as the amount to be disbursed is comparatively low than any other type of loan.
Maintain proper income proof:
The borrower should maintain proper income proof while providing an application for the loans. The borrower should be clear and transparent in case of the disclosure of the income as the bank needs to have information about the exact source of income of the borrower and also the exact income of the borrower.
Having proper & clear transparency in case of the personal loans is necessary as the bank needs to have accurate information about the borrower. The bank does a proper background verification check of the borrower before the approval of the personal loans, as the banks are concerned about the recovery of the loans that the loans should not turn into bad debt.