Personal Loan - Eligibility & Interest Rate

In our day to day routine life, time comes when we have an excess liquidity in our hand or exact liquidity in hand. Times comes too when we have liquidity crunch. A personal loan comes handy when there is a miss match of inflow and outflow of funds. This may arise due to many reasons such as, medical emergency, unplanned vacation, purchase of any gadget etc.

From bank to bank, amount that can be procured from bank varies ranging from minimum amount of Rs.10,000 to a maximum of Rs.50,00,000. 

Under this type of loan you may or may not provide any collateral to bank. But, if collateral is provided than bank may charge a lower rate of interest, like in case of Axis bank werev collateral if provided, the rate of interest charged is lowered by 100 basis point. As there is no need of collateral in most of the cases, documentation under the same is pretty less.

The repayment of loan can be done in Equated Monthly Instalments (EMI), and the same can vary from 12 months – 60 months.

Again, pre payment in part or in full may or may attract penalty depending upon bank to bank. But in case of late payment, a interest rate of 2.00% per month or 24.00% p.a is levied on the due amount.

An upfront fee of 1.00% is charged in most of the cases by banks or lenders in the name of processing fee.

One thing, that bank also checks before giving any loan, is that whether you reside in rural or urban area, you level of income per month or per annum.