There are many who need extra amount once in a while to tide over the period of financial crisis. The amount is not necessarily for buying home or vehicle or renovation. It can be for any personal use without any particular requirement. In such a situation you can take shelter of personal loan. It is a form of unsecured loan which you can use for any purpose. It neither requires you to mortgage any security nor collateral. From wedding expenditure to holiday tours, you can use this loan amount for covering up all types of personal expenditure. From 50,000 to 30 lakh, you can take loan on any amount which also depends upon your payment capacity. The repaying term is usually between 1 to 5 years.
Advantages of Personal loan
- For getting personal loan, you do not require any security. That is why, you can easily apply and get personal loan unlike the secured loan in which you have to pledge property, house or some other valuable thing or assets.
- Personal loan does not require you to submit complex documents or papers. It does not take much time for sanctioning. You can easily get personal loan from nationalized or co-operative banks although the rate of interest in the latter case is a bit higher.
- Unlike home loan or vehicle loan where you are expected to give every detail of the loan amount spent in case of loan amount you are not expected to disclose the reason for borrowing the money neither you have to tell officially for what reason you would be using it. The only concern bank has in all this matter is that whether the borrower is capable of paying back the loan. And for this the lending officials only check your income proof, nature of employment, business and related factors that establish your paying back capability.
- Through personal loan you can fulfill bigger requirements as you can get up to 30 lakhs maximum amount of loan if you have the paying capacity.
Documents required for personal loan
The process of documentation in case of personal loan is very quick as the requirements are very basic. Generally financial institutions look out for following documents along with loan applications:
Salaried person: Identity proof, bank statements of past six months, salary slip, residence proof, and guarantors and similar set of their documents.
Self employed: Profit and loss account, balance sheets, and partnership deed.