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City: Gurgaon

I hereby appoint Paisabazaar as my authorised representative to receive my credit information from the following bureau partners :

I hereby unconditionally consent to and instruct the above bureaus to provide my credit information to me and Paisabazaar on a month to month basis. I understand that I shall have the option to opt out/unsubscribe from the service.

Name :
Date :29/03/2020

CC:
Paisabazaar.com,
Paisabazaar Marketing and Consulting Private Limited

CIBIL TERMS AND
CONDITIONS

To,
TransUnion CIBIL Limited
[Formerly known as Credit Information Bureau (India) Limited]
One Indiabulls building ,Unit No 1901 – 1905,
19th Floor, Tower 2A-2B, Jupiter Mill compound,
Senapati Bapat Marg, Lower Parel, Mumbai 400 013

Sub: Grant of Consent

Dear Sirs,

In connection with submission of the application for my credit information offered by CIBIL (“Consumer Credit Information”) through Paisabazaar (referred to as the “Company”) and delivery of the Consumer Credit Information to the Company, I hereby acknowledge and agree to the following:

A. The Company is my lawfully appointed agent and he / it has agreed to be my agent for the purposes, including, without limitation, to receive the Consumer Credit Information from TUCL on my behalf and use it in the manner consistent with the Agreement entered into between the Company and TUCL, and the Company has granted its consent for being appointed for the aforesaid purpose.

B. I grant my unconditional consent to the Company to receive the Consumer Credit Information from TUCL on my behalf and use it in the manner consistent with the Agreement entered into between the Company and TUCL, as the case may be, and the Company has granted its consent for being appointed for the aforesaid purpose. I hereby represent and acknowledge that: the Terms of Understanding in relation to the use of the Consumer Credit Information has been agreed between me and the Company.

C. I hereby expressly grant unconditional consent to, and direct, TUCL to deliver and / or transfer my Consumer Credit Information to the Company on my behalf.

D. I shall not hold TUCL responsible or liable for any loss, claim, liability, or damage of any kind resulting from, arising out of, or in any way related to: (a) delivery of my Consumer Credit Information to the Company ; (b) any use, modification or disclosure by the Company of the contents, in whole or in part, of my Consumer Credit Information , whether authorized or not; (c) any breach of confidentiality or privacy in relation to delivery of my Consumer Credit Information to the Company ; (d) for any use made by the Company which is contrary to the Agreement entered into between the Company and TUCL

E. I acknowledge and accept that: (a) TUCL has not made any promises or representations to me in order to induce me to provide my Consumer Credit Information or seek any consent or authorization in this regard; and (b) the implementation of the Agreement between TUCL and the Company is solely the responsibility of the Company.

F. I agree that I may be required to record my consent / provide instructions electronically and in all such cases I understand that by clicking on the "I Accept" button below, I am providing "written instructions" to Paisabazaar authorizing Paisabazaar to obtain my Consumer Credit Information from my personal credit profile from TransUnion CIBIL LIMITED, [formerly known as Credit Information Bureau (India) Limited]]. I further authorize Paisabazaar to obtain such information solely to confirm my identity and display my Consumer Credit Information to me. Further in all such cases “By checking this box and clicking on the ‘Authorize button, I agree to the terms and conditions, acknowledge receipt of TUCL privacy policy and agree to its terms, and confirm my authorization for Paisabazaar to obtain my Consumer Credit Information.

G. I understand that in order to deliver the product to me, I hereby authorize Paisabazaar, to obtain my Consumer Credit Information from TUCL.

H. By submitting this registration form, I understand that I am providing an express adhoc one-time written instructions for Paisabazaar to request and receive information about me from third parties, including but not limited to a copy of my consumer credit report and score from consumer reporting agencies, at any time for so long as I have an active Paisabazaar account. I further authorize Paisabazaar to retain a copy of my information for use in accordance with the terms of use of this service, Paisabazaar’s Terms of Use and Privacy Policy.

I. I UNDERSTAND THAT THE PRODUCT IS PROVIDED ON AN “AS-IS”, “AS AVAILABLE” BASIS AND TUCL EXPRESSLY DISCLAIMS ALL WARRANTIES, INCLUDING THE WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT.

J. I shall not sue or otherwise make or present any demand or claim, and I irrevocably, unconditionally and entirely release, waive and forever discharge TUCL , its officers, directors, employees, agents, licensees, affiliates, successors and assigns, jointly and individually (hereinafter “Releasee”), from any and all manner of liabilities, claims, demands, losses, claims, suits, costs and expenses (including court costs and reasonable attorney fees) (“Losses”), whatsoever, in law or equity, whether known or unknown, which I ever had, now have, or in the future may have against the Releasee with respect to the submission of my Consumer Credit Information and / or my decision to provide TUCL L with the authority to deliver my Consumer Credit Information to the Company . I agree to defend, indemnify, and hold harmless the Releasee from and against any and all Losses resulting from claims made against TUCL L by third parties arising from and in connection with this letter.

K. I agree that the terms of this confirmation letter shall be governed by the laws of India and shall be subject to the exclusive jurisdiction of the courts located in Mumbai in regard to any dispute arising hereof. TUCL is entitled to assign its rights hereunder to any third person without taking my prior written consent.

Yours faithfully,
Name :

I hereby appoint Paisabazaar as my authorised representative to receive my credit information from the following bureau partners :

I hereby unconditionally consent to and instruct the above bureaus to provide my credit information to me and Paisabazaar on a month to month basis. I understand that I shall have the option to opt out/unsubscribe from the service.

Name :
Date :29/03/2020

CC:
Paisabazaar.com,
Paisabazaar Marketing and Consulting Private Limited

EQUIFAX TERMS AND
CONDITIONS

I Mr./Ms. -------------------- ---------------------residing at ------------------------ ---------------------------------------- do hereby authorise Paisabazaar Team ,to do all acts on my behalf as may be necessary including to execute/sign application(s), make payment of applicable fees* and generally to all other acts as may be necessary to receive, on my behalf and at my request, my Credit Information Report (CIR) from Equifax Credit Information Services Private Limited("Equifax") at the following address/email id:

I hereby confirm that all the powers hereby conferred may be exercised by officer(s) or manager(s) / agent(s) / employees of the Paisabazaar who is duly authorized by the Paisabazaar.

I hereby confirm, agree, undertake and accept that I shall at all times be solely responsible for all the above actions and omissions of the Paisabazaar shall be binding on me as though such actions had been carried out by me directly. I further confirm that my CIR shall be used only for the purpose as mentioned in the attached standard terms and conditions and I shall be solely liable for, and indemnify and hold harmless Equifax for and against, any and all third party claims or damages or proceedings of any kind, arising from or in connection with (a) any misrepresentations, incorrect information or omission of any critical information in my application, or (b) furnishing my CIR based on this authorization letter, and shall not at any time hold Equifax or its affiliates and their respective officers, directors, employees or representatives liable in this respect.

I hereby also confirm that I have only appointed Paisabazaar to be my authorized agent/representative for collection of my CIR.

I undertake to keep Equifax intimated and informed at all times, of any renewals or termination of the authorization to Paisabazaar or any amendments, modifications or changes in the terms governing the obligations or my relationship with Paisabazaar.

I shall at all times co-operate with Equifax and execute and deliver to Equifax such instruments and documents and take such other actions as may be required by Equifax from time to time in connection with this authority letter.

By signing on this authorization letter, I hereby acknowledge and accept the Standard Terms and Conditions mentioned above.

Date : 29/03/2020

I hereby appoint Paisabazaar as my authorised representative to receive my credit information from the following bureau partners :

I hereby unconditionally consent to and instruct the above bureaus to provide my credit information to me and Paisabazaar on a month to month basis. I understand that I shall have the option to opt out/unsubscribe from the service.

Name :
Date :29/03/2020

CC:
Paisabazaar.com,
Paisabazaar Marketing and Consulting Private Limited

EXPERIAN TERMS AND
CONDITIONS

YOU HEREBY APPOINT PAISABAZAAR AS YOUR AUTHORISED REPRESENTATIVE TO RECEIVE YOUR CREDIT INFORMATION FROM EXPERIAN.

YOU HEREBY IRREVOCABLY AND UNCONDITIONALLY CONSENT TO SUCH CREDIT INFORMATION BEING PROVIDED BY EXPERIAN TO YOU AND PAISABAZAAR AND YOU HEREBY AGREE, ACKNOWLEDGE AND ACCEPT THE TERMS AND CONDITIONS SET FORTH HEREIN. YOU HEREBY ALSO AGREE AND ACKNOWLEDGE THAT FOR PAISABAZAAR TO SERVICE YOU AS A CUSTOMER, THE CREDIT INFORMATION SHALL BE SHARED BY EXPERIAN WITH YOU AND PAISABAZAAR ON A MONTHLY BASIS. YOU FURTHER ALSO AGREE AND CONSENT TO RECEIVE SUCH CREDIT INFORMATION DIRECTLY FROM EXPERIAN AND ALSO THROUGH YOUR PAISABAZAAR ACCOUNT AS PER YOUR INDEPENDENT REGISTRATION WITH PAISABAZAAR.

Please read the Terms and Conditions of this document carefully before accepting. By clicking on the "I ACCEPT" button below, you are expressly agreeing to access the Experian Credit Information Report and Credit Score (as defined in the Important Information Section below) (together referred as "Credit Information") and share a copy of the Credit Information with Paisabazaar in the "as is" format. Please click on the link below to read and understand the Important Information section below.

** This document is an electronic record in terms of the Information Technology Act, 2000 and Rules made there under, and the amended provisions pertaining to electronic records.

Information Collection, Use, Confidentiality, No-Disclosure and Data Purging

PAISABAZAAR/ We/ Us can only access your Credit Information as your authorized representative and we shall use the Credit Information for limited end use purpose consisting of and in relation to the services proposed to be availed by you from us on the Website. We shall not aggregate, retain, store, copy, reproduce, republish, upload, post, transmit, sell or rent the Credit Information to any other person and the same cannot be copied or reproduced other than as agreed herein.

We shall protect and keep confidential the Credit information both online and offline and use best in class security measures in line with applicable laws. The Credit Information shared by You, or received on your behalf shall be destroyed, purged, erased promptly upon the earlier of: (i) your written request to terminate this relationship with Paisabazaar (ii) the completion of provision of the Services by us to you.

Governing Law and Jurisdiction The relationship between you and the Parties shall be governed by laws of India and all claims or disputes arising there from shall be subject to the exclusive jurisdiction of the courts of [Mumbai].

Definitions: Capitalised terms used herein but not defined above shall have the following meanings:
"Credit Information Report" means the credit information / scores / aggregates / variables or reports which shall be generated by Experian;
"Credit Score" means the score which shall be mentioned on the Credit Information Report which shall be computed by Experian.
"CICRA" shall mean the Credit Information Companies (Regulation) Act, 2005 read with the Credit Information Companies Rules, 2006 and the Credit Information Companies Regulations, 2006, and shall include any other rules and regulations prescribed thereunder.
PLEASE READ THE ABOVE MENTIONED IMPORTANT INFORMATION AND CLICK ON "ACCEPT" FOLLOWED BY THE LINK BELOW TO COMPLETE THE AUTHORISATION PROCESS FOR SHARING OF YOUR CREDIT INFORMATION BY EXPERIAN WITH YOU AND PAISABAZAAR, IN ITS CAPACITY AS YOUR AUTHORISED REPRESENTATIVE.
BY CLICKING "ACCEPT" YOU AGREE AND ACCEPT THE DISCLAIMERS AND TERMS AND CONDITIONS SET OUT HEREIN. THE TERMS AND CONDITIONS MENTIONED HEREIN MAY CHANGE IN ORDER TO COMPLY WITH GOVERNING LAWS OF THE COUNTRY AND THE CONSUMER SHALL BE BOUND TO ANY CHANGES TO THIS AGREEMENT

Name :
Date : 29/03/2020

I hereby appoint Paisabazaar as my authorised representative to receive my credit information from the following bureau partners :

I hereby unconditionally consent to and instruct the above bureaus to provide my credit information to me and Paisabazaar on a month to month basis. I understand that I shall have the option to opt out/unsubscribe from the service.

Name :
Date :29/03/2020

CC:
Paisabazaar.com,
Paisabazaar Marketing and Consulting Private Limited

CRIF HIGH MARK TERMS
AND CONDITIONS

This End User Agreement (the "Agreement") is made between you (the "User" or "You") and Paisabazaar Marketing and Consulting Pvt Ltd ("PaisaBazaar"), a private limited company having its registered office at Plot No 119, Sector-44, Gurgaon-122001, Haryana ("PAISABAZAAR", "Us" or "We", which term shall include its successors and permitted assigns). The User and PAISABAZAAR shall be collectively referred to as the "Parties" and individually as a "Party".

YOU HEREBY APPOINT PAISABAZAAR AS YOUR AUTHORISED REPRESENTATIVE TO RECEIVE YOUR CREDIT INFORMATION FROM CRIF HIGH MARK. BY EXECUTING THIS AGREEMENT / CONSENT FORM, YOU ARE EXPRESSLY AGREEING TO ACCESS THE CRIF HIGH MARK CREDIT INFORMATION REPORT AND CREDIT SCORE, AGGREGATE SCORES, INFERENCES, REFERENCES AND DETAILS (AS DEFINED BELOW)(TOGETHER REFERRED AS "CREDIT INFORMATION"). YOU HEREBY ALSO IRREVOCABLY AND UNCONDITIONALLY CONSENT TO SUCH CREDIT INFORMATION BEING PROVIDED BY CRIF HIGH MARK TO YOU AND PAISABAZAAR BY USING CRIF HIGH MARK TOOLS, ALGORITHMS AND DEVICES AND YOU HEREBY AGREE, ACKNOWLEDGE AND ACCEPT THE TERMS AND CONDITIONS SET FORTH HEREIN. YOU ALSO ACKNOWLEDGE THAT YOU SHALL NOT RAISE ANY CLAIM OR HOLD LIABLE CRIF HIGH MARK CREDIT INFORMATION SERVICES PRIVATE LIMITED IN RELATION TO YOUR CREDIT INFORMATION REPORT AND CREDIT SCORE PROVIDED OR TO BE PROVIDED BY CRIF HIGH MARK TO PAISABAZAAR.

Terms and Conditions: Information Collection, Use, Confidentiality, No-Disclosure and Data Purging PAISABAZAAR shall access your Credit Information as your authorized representative and PAISABAZAAR shall use the Credit Information for limited end use purpose consisting of and in relation to the services proposed to be availed by you from PAISABAZAAR. PAISABAZAAR shall not aggregate, retain, store, copy, reproduce, republish, upload, post, transmit, sell or rent the Credit Information to any other person and the same cannot be copied or reproduced other than as agreed herein.

The Parties agree to protect and keep confidential the Credit Information both online and offline. The Credit Information shared by you, or received on by us on your behalf shall be destroyed, purged, erased promptly upon request from the consumer or the consumer withdrawing the consent to retain such credit information / reports by deleting/deactivating the consumers account with Paisabazaar.

Governing Law and Jurisdiction Definitions: Capitalised terms used herein but not defined above shall have the following meanings:
" Business Day" means a day (other than a public holiday) on which banks are open for general business in Gurgaon and Mumbai.
" Credit Information Report" means the credit information / scores/ aggregates / variables / inferences or reports which shall be generated by CRIF High Mark;
" Credit Score" means the score which shall be mentioned on the Credit Information Report which shall be computed by CRIF High Mark.
" CICRA" shall mean the Credit Information Companies (Regulation) Act, 2005 read with the Credit Information Companies Rules, 2006 and the Credit Information Companies Regulations, 2006, and shall include any other rules and regulations prescribed thereunder.
IN CASE THERE IS ANY DISCREPANCY OR INABILITY IN COMPLETION OF ONLINE AUTHENTICATION, PLEASE SUBMIT YOUR SELF ATTESTED KYC DOCUMENTATION IN SCANNED COPIES FOR SHARING OF YOUR CREDIT INFORMATION BY CRIF HIGH MARK WITH YOU AND PAISABAZAAR (YOUR AUTHORISED REPRESENTATIVE).
ONLINE SUBMISSION - DOES NOT REQUIRE SIGNATURE AND EXECUTION"

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Date :29/03/2020

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Updated: 05-12-2019 05:35:39 AM

Secured loans are a type of debt where an applicant mortgages their immovable property or hypothecates their movable assets to get the necessary funds. It is one of the easiest loans for people to avail. Secured loan applicants get low interest rates and flexible tenures. This is because the applicant has given their property as collateral and the bank can benefit from the lower risk profile. Failure to repay the loan leads to loss of the property as the lending institution disposes off the same to recover their money.

These loans can be taken for a variety of purposes such as buying a new car, a house or starting a new business. This allows applicants to do things that would not have been possible otherwise due to lack of funds. 

Purpose of Secured Loans

These loans give an opportunity to applicants to get the necessary finance on better terms. Since the applicant has pledged an asset to avail the loan, it puts them in a comfortable position as they can bargain for lower interest rates and flexible tenures, as compared to an unsecured loan. In addition, the applicant can get higher loan amounts based on the value of their collateral.

Types of Secured Loans

  • Loan Against Property or Mortgage Loans
  • Car Loans
  • Home Loans
  • Business Loans
Features of Secured Loans
Eligibility Criteria for Secured Loans
Documents Required for Secured Loans
Benefits of Secured Loans
Points to Note for Secured Loans
Frequently Asked Questions (FAQs) about Secured Loans

Features of Secured Loans

The features of each specific secured loan differ from one another. However, they have a few general characteristics in common:

  • Asset Required as Collateral: It is taken against a property or asset which is given as collateral. The loan can be up to 85% of the value of the property.
  • Low Interest Rates: When compared with unsecured loans, the interest rates for these loans are much lower. This is because banks face lower risk in case of default.
  • Available for All: It can be taken by salaried as well as non-salaried individuals, as well as proprietorship and corporate businesses.
  • Customisable: The loan can be customised according to the applicant’s needs. For instance, the loan offers flexible repayment options. Additionally, the applicant can choose the type of interest they want. Most banks offer a mix of fixed and variable interest rates. Banks also offer flexible loan tenures.
  • No Guarantor Needed: There is no need for a guarantor for this loan.
  • Quick Processing: The processing and approval are quicker.
  • Improves Credit Score: Timely repayment of the loan improves your credit score.
  • Possibility of Asset Takeover: Banks and lenders can repossess your assets if you fail to repay your loan.

Eligibility Criteria for Secured Loans

As with the features, the eligibility criteria are different for each specific type of secured loan. However, they do have some common criteria. For instance:

  • The applicant must be at least 18 years of age.
  • The applicant must be a resident of India.
  • The asset put up as collateral must be the same or exceed the value of the loan.
  • In case of a business loan, the business in question should have in operation for at least 3 years.
  • Salaried, non-salaried and self-employed individuals can apply but need to meet the specific criteria needed for each.

Documents Required for Secured Loans

The following documents are required for different types of secured loans:

Mortgage Loans / Loan Against Property

  • ID Proof: Copy of one of the documents: Voter Card / Aadhaar Card / Passport / PAN Card
  • Age Proof: Copy of one of the documents: Passport / Driver’s License / Aadhaar Card
  • Residence Proof: Utility Bills / Rent Agreement / Passport
  • Income Proof: Salary slips for the last 3 months. Banks also ask for IT returns and / or Form 16
  • Bank Statement: Bank Statement of the last 6 months that have been duly authenticated
  • Proof of Signature: This is done to authenticate your signature on documents
  • Property Papers: Original documents of the property that has been put up as collateral
  • Passport size photographs
  • Duly filled application form

Home Loan

  • ID Proof: Copy of one of the documents: Driver’s License / Aadhaar Card / Passport
  • Age Proof: Copy of one of the documents: Passport / Driver’s License / Aadhar Card
  • Residence Proof: Copy of one of the documents: Utility Bills / Passport / Lease Agreement
  • Income Proof: Salary slips of the past 3 months in addition to IT returns and / or Form 16
  • Bank Statement: Authenticated statements of the past 6 months are needed
  • Proof of Signature: This is done to authenticate your signature on documents
  • Property Papers: All property papers in original need to be submitted to the bank
  • Passport size photographs
  • Duly filled application form

Car Loan

  • ID Proof: Copy of one of the documents: Voter Card / Aadhaar Card / Passport / PAN Card
  • Age Proof: Copy of one of the documents: Driver’s License / Passport / Aadhaar Card
  • Residence Proof: House Tax Receipt / Electricity Bill / Water Bill
  • Income Proof: Salary slips of the past 3 months / IT returns / Form 16
  • Bank Statement: Authenticated bank statement of the previous 6 months
  • Proof of Signature: This is required from the bank
  • Passport size photographs
  • Application form, duly filled

Business Loans

  • ID Proof: Copy of any one of the following documents: PAN Card / Driver’s License / Aadhaar Card
  • Residence Proof: Copy of any one of your Telephone Bill / Lease Agreement / Electricity Bill / Water Bill
  • Company Profile: Information regarding the company’s products and services
  • Financials: The balance sheet and profit and loss accounts of the company for the past 3 years.
  • IT Returns: The IT returns filed by the company for the last 3 years
  • Bank Statements: The bank statements for the last few months are needed
  • Management: Profile of the promoter
  • Property Papers: Original documents of the property if put up as collateral
  • Passport size photographs
  • Application form, duly filled

Benefits of Secured Loans

The secured loans offer a number of benefits for the borrower. Some of these are:

  • Low Interest Rates: Since the loan is taken against collateral, the bank can offer loans at low interest rates. This is because the mortgaged property minimises the risk, so the bank has faith in the repayment capacity of the applicant.
  • Higher Amount of Loans: Large loans can be taken based on the value of the property that has been put up as collateral. It must be noted though, that the loan amount cannot exceed the value of the mortgaged property (in most cases, the upper limit is 75-85%).
  • Quicker Processing and Approval: The loan procedure is not time consuming. Quick processing and approval make this a comfortable experience.
  • Flexible Loan Repayments: Secured loans give the applicants multiple ways of repaying the loan. The applicant can pay back the loan through ECS mandated EMIs or post-dated cheques, for instance. They can also prepay their loan if they have additional money on them.
  • Bad Credit Score Applicants: Individuals with a bad credit score can also avail this loan. Timely payment of a secured loan will greatly boost the credit score of the applicant.
  • Tax Deductible: In case of home loans, the interest on the loan is tax deductable. This will save the applicant a lot of money.
  • Low Minimum Income Standard: The minimum income bar for secured loan applicants is low. This is because the applicant has already assured the bank of their repayment capacity by mortgaging their property.

Points to Note for Secured Loans

Though secured loans are a great way to finance large purchases, there are certain factors that one must keep in mind when they take such a loan.

  • Collateral: In a secured loan, a property or asset has to be kept as collateral in order to avail a loan. If the applicant is unable to repay the loan, then they will end up forfeiting the said property.
  • Paperwork: This loan requires more paperwork than an unsecured loan. This may make the whole process cumbersome for certain applicants.
  • Loan Based on Collateral: The loan amount taken can only be up to a certain value of the asset or property that has been kept as collateral. This limits the amount of loan that an applicant can borrow.
  • Full Owner of Property: The applicant must be a complete owner of the property that has been kept as collateral.
  • Floating Rate of Interest: The EMI amount paid on a floating interest rate fluctuates. This is because on a floating rate of interest, the rate of interest keeps changing based on the market conditions and RBI policies. This creates problems for loan applicants as their EMI amounts will keep going up and down. This may disrupt the applicant’s expenditures and budget.
  • Lender at an Advantage: In a secured loan, the lender is always in an advantageous position. The deal is tilted in their balance. It does not matter whether the applicant is able to pay back the loan or not, as the lender will recover the cost.

Frequently Asked Questions (FAQs) about Secured Loans

Here are a few FAQs that people have on these secured loans: 

Q. Why should one go for a secured loan?

A. Secured loans are the best option for many reasons. The loan can be taken up to the value of the property. The borrowers get low interest rates and they can pay back the loan amount over a period of time. Moreover, applicants who do not have a strong credit history can get the loan easily.

Q. What happens to the mortgaged asset if the applicant is unable to repay the loan?

A. If the applicant is unable to repay the loan, then the mortgaged property changes hands. The bank / lender become the new owner of the property and they choose to sell or rent the said property in order to recover their losses.

Q. Is there a penalty on late EMI payments?

A. Yes, banks charge a penalty on late EMI payments. Therefore, it is advised that applicants make their repayments on time. 

Q. Is there a charge on prepayments?

A. Banks have certain conditions on prepayments. For instance, banks will charge a penalty on prepayments if these payments are made within a six month period. But, they might not charge anything if the prepayment is made after six months from the date the loan was taken. Readers should note that most home loans do not have a prepayment fee. They should contact their bank for more details on these charges, if any.

Q. What is the maximum amount that can be borrowed?

A. In secured loans, the amount of loan that can be borrowed depends on the value of the property that has been mortgaged. The loan amount can either be equal to or less than the mortgaged property. It, however, cannot exceed it. In most cases, the amount of loan does not exceed 85% of the market value of the asset or property.

Q. What is the eligibility criterion for availing a secured loan?

A. The applicant must be at least 18 years of age and a resident of India. They should have a minimum salary income as prescribed by the bank. If they have their own business, then the business should be operational for at least 3 years. The loan amount cannot exceed the value of the asset. Salaried, non-salaried and self-employed individuals can apply for a secured loan.

Q. What is an EMI and how is it calculated?

A. Equated Monthly Instalments (EMIs) are monthly payments that the applicant pays in order to foreclose their loan. The EMI amount is calculated based on the principal amount, rate of interest and the loan tenure. The EMI calculator is an online tool that can be used to ascertain the EMI amount. Once the EMI amount is known, the applicant can plan their expenditures accordingly. You can use the Paisabazaar EMI tool to understand better how much loan you should take and the EMIs that you will have to pay, among others.

Q. What is the difference between fixed and variable rates of interest on secured loans?

A. In a fixed rate of interest, the EMI amount remains the same. However, in a variable rate of interest regime, the EMI amount fluctuates as the rate of interest keeps changing. This makes this rate of interest comparatively unpredictable.

Q. What are the different types of secured loans?

A. The different types of secured loans include, among others:

  • Mortgage loan or loan against property
  • Car loan
  • Home loan
  • Business loan

Q. What are the different uses for which one can use secured loans?

A. Borrowers can use secured loans for different reasons. People who need a home, for instance, can take a home loan while those who need a larger sum for business or other personal reasons can use a loan against property. In most cases, except for loan against property that can be used for multiple reasons, the end use of the secured loan is defined by its type. For example, you cannot use a car loan for anything else other than purchasing a car.

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