A personal loan is a type of unsecured loan that does not require a collateral or security. Unlike a car loan or a home loan, a personal loan comes with flexible end use and can be availed to meet any personal expense. The application process of a personal loan is simpler as compared to other loans as the banks do no need to verify the details of any security or collateral. The only details that a bank requires to verify is the eligibility and credit worthiness of an individual availing the loan. Also, the online application and minimum documentation has made the whole process more approachable and simpler.
What Are the 8 Easy Steps to Get a Personal Loan in India?
The steps to apply for a personal loan in India are as follows:
- Online/offline application: If you have planned to avail a personal loan, the first step would be to fill an application form asking for your personal as well as professional details. The form can either be filled online at Paisabazaar.com or offline by visiting the nearest branch of the bank. However, applying for a loan online will not only simplify the process but will also save your time
- Bank verification: When bank receives your loan application, it starts verifying the information provided by you, including your personal as well as professional details and check if you meet the eligibility criteria including age, minimum monthly salary, profession, etc. If you are already an existing customer of the bank, your financial details like bank statements, previous loans (if any), etc. are immediately verified by the bank
- KYC process: After your basic details are verified, the bank will start verifying your Know Your Customer (KYC) documents that you might have uploaded online along with the application form or would have submitted to the nearest branch. If you apply for a personal loan through Paisabazaar.com, the bank executive will come to your home or office to collect the documents
- Address confirmation: The bank’s executive may make a visit to your home to confirm the address mentioned in the application. Also, if you are a self- employed individual, there are more chances of the bank’s executive visiting to confirm your office address
- Credit score check: After checking your eligibility and completing the verification process, the bank will check your credit score and will see your past repayments, salary slips or IT returns
- Loan approval: If you meet the eligibility criteria, your documents are verified and if your credit score is 750 or above, the personal loan would be sanctioned to you without any further delay
- Loan amount, tenure and interest rate: The loan amount and interest rate that the bank will offer you will be based on your credit score, age, employer, number of years left in service, etc. The banks also offer you the opportunity to choose the repayment tenure (within the tenure range provided by the bank) on your own as per the repayment ability
- Processing fee: Once everything is decided including the loan amount and tenure, you will have to pay a processing fee to process loan disbursal. After you have paid the fee, the personal loan amount will be disbursed to your account with 3-5 working days
A personal loan can solve your various purposes like paying medical bills, getting married, going on a vacation, purchasing consumer durable, etc. but it is important to borrow the amount that you can easily repay. Also, it is necessary to submit all the authentic documents and fill all the information correctly for smooth processing, approval and disbursal.