Personal loan can be your best financial ally whether you are in pressing need of cash or wish to make a big-ticket purchase. Easy application process, quick approval and minimum documentation are just a few of the many reasons that make this a go-to loan option. But do you know there are 6 different types of personal loans? And, that all of these take care of your specific financial requirements – from travelling and renovating your house to setting up a business. Take a look.
Types of Personal Loans
It is a short-term loan offered to take care of your festive expenses. It is usually a small amount of money, so that unavailability of ready funds does not dampen your festive mood. These loans have a low borrowing limit, however, they usually come with lower interest rate and the processing fee charged is also less.
This loan aims to help couples and families deal with the pressure of wedding finances. It can be used to fund such major expenses as hotel bookings, jewellery shopping, catering and decoration among others. The interest rates for these loans are usually higher during the peak wedding season as compared to the off season.
If you wish to take care of your travel bills without draining your savings or affecting your monthly budget, this is the kind of loan you should go for. While credit cards can also do the task for you, a holiday loan can make the funds readily available for your travel plans and that too at a lower interest rate. The loan amount will depend both upon your credit worthiness and your travel destination.
As the name suggests, this loan can help you finance your home’s repair and renovation. So, if you had been putting of repairing that leaky ceiling or wanted to get wooden flooring done, this loan can help you without denting your savings. Note that interest paid on this type of personal loan is tax exempt.
Consumer durable loans
Banks also offer customized personal loans for purchase of consumer durables such as home appliances and gadgets. Almost all banks offer 100% finance for the purchase of such household items as TV, refrigerator, microwave, mobile phones, and tablets.
Unsecured Business loan
Usually, when seeking a loan to set up or expand a business, lenders ask for collateral. In such situations, an unsecure business loan can be of tremendous help as loan approval depends on your eligibility and credit worthiness and not on the value of your collateral.
So, now that you know the different types of personal loans, plan and decide carefully before applying. And for finding the right loan offer, simply log on to Paisabazaar.com to compare and apply!