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Personal Loan for Credit Card Payment

Credit cards are one of the easiest ways of getting credit. However, at times we might lose track of our expenditure and overspend our plastic money. In such cases, getting a personal loan to pay off your credit card debt can be very beneficial.

Why should I take a Personal Loan for paying off my Credit Card Debt?

Paying off your credit card bills on time is one of the most important factors which is taken into consideration for deciding your creditworthiness. You can always pay off at least the minimum amount which is due on your credit card and carry forward the remaining amount. However, if you are not able to pay the minimum amount as well, it will have a negative impact on your credit scores.

In such cases, you can consider getting a personal loan which is usually offered at an interest rate which is lower than the credit card’s interest rate. You can use this money to pay off the credit card bill and take your own sweet time to pay off the personal loan in Equated Monthly Instalments or EMIs. Resorting to this method not only clears off your debt on the card but also makes it easier for you to manage your finances.

Benefits of taking a Personal Loan to pay off your Credit card debt

If you are overburdened by your credit card debts, a personal loan might be the best option. Some of the benefits are as follows:

  • Affordable monthly payment: Taking a personal loan for debt consolidation will help you manage your finances more efficiently. Instead of paying off the credit card debt, you would be paying off your personal loan in easy EMIs.
  • Loan repayment: You can calculate and manage your finances on the basis of the monthly payments. You can decide the tenure of loan repayment on the basis of the effective EMI amount.
  • Avoid paying high interest: Although personal loans have higher interest rates when compared to other types of loans, they are usually lower than the interest rates on credit cards. Taking a personal loan with a lower interest rate to pay off your credit card debts will help you avoid paying very high interests.
  • Avoid paying penalties: You can avoid paying the additional penalties which are charged on your credit card debt if it is not paid off on time. The interest rate of your credit card along with these penalties and fines can add up to put you under heavy debt.

Eligibility Criteria for a Personal Loan for Credit Card Payments

The eligibility criteria for personal loans differ from lender to lender. However, there are certain factors which are common across the industry. Some of these factors are as follows:

  • Minimum age: 21 years to 28 years
  • Maximum age: 58 years to 68 years
  • Credit score: 750 or higher is recommended
  • Source of income: Whether you are a salaried employee or a self-employed individual, you should have a stable source of regular income. The minimum income, however, varies from lender to lender.

There are a number of other factors which are considered for your personal loan eligibility. You can also check the personal loan eligibility for top lenders in 2019 Click Here for a detailed idea.

Documents Required for Personal Loans

You will need to provide your PAN, identity proof, address proof, and income proofs. This will include:

  • Passport-sized photographs
  • Completed application form
  • PAN
  • Aadhaar card, Voter’s ID card, Driving Licence or Passport
  • Salary slips, salary certificate, and Form 16 if you are a salaried person
  • Bank statements for the past 3-6 months
  • Proof of business which could be the certificate of establishment, sales tax certificates, income tax returns, profit and loss statements, balance sheet, etc.

How to Apply for a Personal Loan for Credit card payments?

Applying for a personal loan has never been easier. BankBazaar makes sure that your experience is seamless and hassle-free when you are applying for a personal loan. All you need to do is provide a few basic details and BankBazaar will find out the perfect loan product for you on the basis of your eligibility.

BankBazaar will take you through an easy-to-use carousel on which you will be required to provide the information mentioned below:

1) Your gender

2) Your age (including your date of birth)

3) The city in which you reside

4) The type of residence you are residing in

5) Your employment type – salaried, self-employed, retired, and so on

6) If you click on the ‘Salaried’ option in the last slide, you would be required to provide the name of your company

7) The date of joining the company along with total work experience

8) Your net monthly salary

9) The bank with which you have your salary account

10) The purpose of taking the personal loan – in this case, click on ‘Other’

11) If you have any existing loans, you will be required to mention the EMI amount that you are paying for the same (You can skip this step if you don’t have an existing loan)

12) In the final step, you have to provide your personal information, such as your name, mobile phone number, and your email ID.

13) Click on the ‘View FREE Offers’ button in the end, to see all the personal loan products that you are eligible for and apply through BankBazaar.

If you are ready to apply, head to the application section click here and find out the right personal loan and pay off your credit card bills immediately.

Interest rates for Personal Loans for Credit Card Payments

Personal loan interest rates in India starts from 10% p.a. Even with these rates, personal loans are cheaper than credit cards. With credit card overdues, it is unlikely that you would have a high credit score. This means that you may not be able to negotiate low interest rates with your bank.

List of Banks offering Personal Loans

Almost all banks in India offer personal loans to eligible candidates. These banks include nationalised banks, private banks, scheduled cooperative banks, and non-banking financial companies. The prominent personal loan providers include:

  • State Bank of India and its subsidiaries
  • Syndicate Bank
  • Bank of India
  • Andhra Bank
  • Karnataka Bank
  • Canara Bank
  • Corporation Bank
  • HDFC Bank
  • ICICI Bank
  • Axis Bank
  • Kotak Mahindra Bank
  • DCB Bank
  • IndusInd Bank
  • South Indian Bank
  • Karur Vysya Bank
  • Citibank
  • Standard Chartered Bank

Ensure that you use an EMI calculator to see how much amount you would have to pay on your personal loan every month. This will help you determine how much you owe and plan your finances well.

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