Emergency Personal Loan Interest can strike at any time, and an online Personal Loan can be the best financial instrument for your needs. Personal Loans are gaining immense popularity among individuals as they can be used to cover a wide range of expenses. As a result, Personal Loans online are being offered by numerous lending institutions, banks, and Non-Banking Financial Companies (NBFCs).
As online Personal Loans are unsecured, they come with no end-use restrictions and can be used as per your requirement. The eligibility criteria for these loans are easy to fulfill. You only have to submit soft copies for minimal documents and get funds disbursed into your account instantly.
However, before applying for a same-day loan, it is better to research and figure out which lender is offering the best features and benefits. In addition to this, it is also essential to understand and consider some factors regarding Personal Loan interest rates.
Loan Tenure and Amount
Your loan tenure and amount play a great role in determining the interest rate on your online Personal Loan. If you choose a longer loan tenure, the interest rate will be lower. On the other hand, if you choose a shorter loan tenure, the interest rate will be slightly higher. You can use an online Personal Loan EMI calculator to figure out your repayment capacity before applying.
The tool is available online and is easy to use. You just have to enter your desired loan tenure, the Personal Loan interest rate offered to you, and the loan amount. The tool will calculate your monthly EMI for you, based on which you can decide how much amount you need to borrow. This will also help you in planning a repayment strategy.
Extra Charges and Rate Of Interest
The interest rate offered to you on your Personal Loan can increase or reduce your cost of borrowing. It is calculated by lenders based on various factors such as your bureau score, creditworthiness, repayment behavior, loan amount, and loan tenure.
Some lenders also levy extra charges such as processing fees and penalties on late payments and defaults. Hence, before applying, carefully check your interest rate and find out if there are any extra charges or liabilities on the loan.
Charges On Pre/Part-Payment
There can be some instances when you think you need to borrow funds but you will recover the amount soon enough to pay it back. You can choose to prepay your online Personal Loan in this case. However, do remember to check if your lender is charging any penalties on prepayment or part payment.
Debt-to-Income Ratio
Before applying for an online Personal Loan, it is better to analyze your repayment capacity by subtracting the EMI amount from your monthly income. Your EMI amount should not exceed 40% of your monthly or disposable income.
If your EMI amount is higher and is taking up most of your finances, you might end up in a financial crunch, struggling to cover your daily expenses. To avoid this, make sure you calculate your EMIs against your interest rate and loan amount and choose the lender offering the lowest Personal Loan interest rate in India.
Personal Loan Eligibility Criteria
Age- Minimum 24 years at the time of application and full 58 years at the time of loan maturity.
Citizenship- The borrower should be a citizen of India.
Employment- The borrower should be employed at the Central Govt., MNC, PSU, Unlisted Public Ltd., Private Ltd., or companies that are listed internally.
Work experience- The borrower should be employed at the time of application for at least 6 months and should have a minimum of 24 months of total experience.
Monthly income- The borrower must have a monthly take-home salary of a minimum ₹40,000.
In Conclusion
If you find yourself in a financial crunch, you can easily navigate through it with the help of an online Personal Loan. These credit instruments are being offered by banks and NBFCs at attractive Personal Loan interest rates, and the application process is fully online, making it easier for you to apply.
As mentioned above, before applying for the loan, do remember to evaluate your repayment capacity, check the interest rate offered to you, and inquire about hidden charges or fees.
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