FAQS
What is a personal loan ?
Personal loan is an all-purpose loan, which is given in most cases without any kind of security like a car, home, shares etc.
Who are the lenders ?
Most nationalized, foreign, and co-operative banks offer personal loans. Besides banks, some other finance companies and financial institutions also offer them.
What are the lending rates ?
Lending rates differ for different financiers and currently range from 12 to 30 per cent.
What is the minimum & maximum amount that can be issued as a personal loan ?
The minimum amount that can be issued is £1,000 up to £25,000
What are the eligibility criteria for personal loans ?
a. You should be a minimum of 18 years
Who is eligible for a personal loan ?
a. Salaried individuals
b. Self-employed professionals
c. Self-employed non professionals
d. Any salaried individual /self-employed professional is eligible for a loan and the amount of loan eligibility will differ, based on the person's current earnings
Do I have to pay service charges? If so what is the amount ?
Service charges of upto 3% of loan amount are levied.
Why is a personal loan called an all-purpose loan ?
Personal loans are called all-purpose loans because the financier is not concerned about the purpose for which the loan is taken.
Is a guarantor necessary ?
No. Typically you do not have to provide for a guarantor, however some lenders may demand for one.
Can I club the income of my spouse with mine ?
Yes. You can club the income of your spouse for the purpose of boosting your own eligibility for a personal loan.
How is the repayment done ?
Repayment of the loan is done by issuing post-dated cheques for entire tenure of the contract. The amount of the post-dated cheque would be EMI i.e. equated monthly instalment. Some lenders also permit repayment option by way of standing instructions to your bank account or deduction at source from your salary every month.
What is the difference between a personal loan & credit card ?
Unlike loans against credit card, in a personal loan it is necessary for the borrower to draw out the entire loan and the loan is repaid by way of fixed monthly instalments. In the case of a card, the interest is charged based on the amount utilized only.
