Things to know before applying for unsecured Personal Loan

Are you one among them who are looking for some kind of financial assistance? We don’t know when we need that extra money to meet urgent expenses required for school fees, wedding, foreign trips, higher studies, and so on. Though we may try saving some part of our income rationally to meet any emergency, it may not be enough owing to the rising costs and other factors. Banks help you meet your urgent need for money with a personal loan. Being a reliable financial solution, it does not require any collateral.

For a personal loan, you do not have to pledge anything like your property, gold or shares. You have the liberty to use it as you want. Today you can get a personal loan instantly online. However, you should consider a few things when applying for it.

1. An unsecured personal loan requires your creditworthiness

When it comes to your personal loan eligibility, your credit score counts. What is a credit score? It is a 3-digit number, which is calculated based on the payment history, amount of debt, and length of the credit history of a borrower. You have a higher chance of getting a loan approval at favourable terms if you have a higher credit score of 800-850 points.

For your loan application to consider, you need at least 750 points. You do not require any guarantor or co-signee either. With IDFC First Bank, you can borrow up to 1 cr as a personal loan if you are eligible.

2. Meet the age criteria

Before applying for a personal loan, you need to check whether you are at least 23 years of age, and your maximum age at the time of maturity will be the age of retirement or 60 years, whichever comes earlier. If you are self-employed, the minimum age is 25 years and the maximum 65 years at the end of the term.

3. Know and ensure your repayment capacity

You prefer a personal loan, for it is collateral-free, and it can be repaid monthly based on the loan tenure you choose. Banks generally consider the stability of your employment or business, income, cash flow and fixed obligation-to-income ratio, which is a ratio of your monthly income and liabilities, to assess your repayment capacity. Your chances of acquiring a personal loan is high if you have good financial stability.

You can calculate your monthly EMI payment using the personal loan EMI calculator on the IDFC First bank website. For instance, if you are eligible for 1 lakh loan from IDFC First Bank, your EMI payable starts from as low as Rs 1699 per month.  To know more about this, you can log into the IDFC First Bank website or mobile app.

4. High interest rate for unsecured personal loans?

To get a personal loan, you don’t need to provide any security. The personal loan interest rate depends on the amount of loan and the tenure you choose. The higher the tenure, the greater the amount of interest.  Nevertheless, several banks offer an instant loan at a low interest rate based on the income proof, credit history, repayment capacity and applicant’s relationship with the bank.

5. Processing time

Banks generally take about 5 days to process the personal loan application, provided you have submitted all the necessary documents. However, there are instances when the loan is sanctioned within a few hours. They are for pre-approved applications, and for those who have a good track record of the repayment of earlier loans. Nevertheless, the loan approvals and processing time are at the discretion of a particular bank.

So, getting a personal loan with no security is easy; you can click here to apply now!   

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.