Personal Loan Types
Personal loans are unsecured loans in which the bank loans you money on your creditworthiness and no security is required for the money borrowed. However, the interest rates of personal loans are higher than any other loan like home loan or education loan considering the amount of risk involved in lending the sum.
Most banks offer personal loans starting from Rs.50,000 to Rs.15 lakh.
Types of Personal Loans offered in India
Wedding Loan - Weddings are important and costly affairs in India. Most people want their wedding day to be memorable and pull out all stops to achieve their dream. Wedding loans are given out by banks to help you make your special day memorable. Loans can be taken by the would be bride, groom or any of the family members.
Holiday Loan - Designed especially for holiday goers, you can travel around the world and pay the bills later with holiday loans. Holiday loans often come with the added benefit of travel insurance, so you get protected on all fronts.
Home Renovation Loan - Home loans are for buying new pieces of real estate. But what about when you’re old house is in dire need for repairs? People often don’t renovate their house as the cost is too high. Home renovation loans helps you take care of your repairing cost, while simultaneously increasing the economic value of your house on the real estate market.
Festival Loan - India is a land of festivals with each region celebrating a host of festivals unique to its own. But with festivals come expenditure, especially if you are planning to organize something big. Festival loans help you tide over these expenses. Usually, the limit for festival loans is Rs.50,000.
Consumer Durable Loan - Consumer durable loans are extended to buy consumer goods such as television, refrigerator, washing machine etc. Under this scheme, you can avail a loan of up to Rs.2 lakh from some banks.
Pension Loan - Pension loans are exclusively for retired personals, and hence, the usual eligibility criteria doesn’t apply in this special scheme. Under this scheme, some banks provide 7 to 10 times the amount of pension the pensioner drew the month previous to submitting the loan application.
Personal Computer Loan - Seeing how these days owning a computer has become a necessity, some banks have come up with a special scheme for loans to buy computers. You can avail up to Rs.1 lakh to buy a computer and can also opt for an additional loan of up to Rs.20,000 to buy software programs.
Eligibility Criteria for Personal Loans
For Salaried Individuals:
- Minimum Age of the Applicant - 21 years
- Maximum Age of Applicant at Loan Maturity - 60 years
- Minimum Employment Period - 2 years in total and 1 year at present organization
- Minimum Income - Rs. 7,500 per month to Rs.15,000 per month
For Self Employed Professionals & Businessman:
- Minimum Age of the Applicant - 25 years
- Maximum age of Applicant at Loan Maturity - 65 years
- Minimum Business Period - Minimum 2 to 3 years in current profession/business
- Minimum Annual Income - Rs.1 lakh
Please note that eligibility criteria differ from bank to bank. To know the exact eligibility criteria for each bank, use the BankBazaar eligibility calculator tool for exact results, and also compare the criteria’s between your chosen banks.
Best Personal Loan Interest Rates 2018
||11.49% – 17.50%
||11.49% – 19.50%
||12.45% – 16.55%
||11.50% – 19.65%
||15.00% – 20.00%
||11.99%% – 13.49%
||16.00% – 32.00%
||14% – 16.5%
To know more about the various personal loans on offer from 36 different banks and financial institutions, make use of the BankBazaar comparison tool.
Documents required to avail Personal Loans
- Two passport size photographs
- Income proof: Bank Statement for the last 3 months (if salaried)
- Income Tax Returns for the last 2 years (if professional/self-employed)
- Proof of Continuity in Current Job - Form 16/Company Appointment Letter (if salaried)
- Proof of Identity (Passport/PAN Card/Driving License/Voters ID/Aadhar Card)
- Proof of Residence (Passport/Ration Card/Aadhar Card/Utility Bill/Voter ID/LIC Policy Receipt)
- Credit (CIBIL) score
Besides the ones listed above, some banks might offer other types of personal loans. Women often get special offers on personal loans, making the particulars different from the usual personal loan on offer, but the type being the same. For example, a wedding loan taken by a woman and a man from the same bank might get different loan particulars offered, but essentially both will be getting wedding loans.
Choosing the type of loan to opt for finally rests on your requirements. Compare and choose the personal loan that covers your need.