Personal loans are a great way to finance big expenses like weddings, travel, debt consolidation, and medical bills. You can go for different types of secured loans depending on your needs and eligibility. There are also different types of unsecured loans, such as instant loans, credit card loans, or home equity loans. These different loans are offered by banks, NBFCs, online lenders, and loan apps. But with so many different types of personal loans available in India, it can be tricky to know which one is right for you. Each type of loan has its own advantages and disadvantages. Here is a quick overview of some of the most popular types of personal loans so you can make the best decision for your financial future.
Types of Personal Loans in India
1. Travel Loan
A travel loan helps you pay for your travel expenses like flight tickets, hotel stays, and tour packages. It is great for vacations, solo trips, or business tours. Travel loans are quick to get and easy to repay, and this is what makes it easier to enjoy your trip without worrying about money.
2. Wedding Loan
Wedding loans are a type of personal loan specifically designed to help finance the cost of a wedding. Weddings often require large expenses to be paid all at once such as for the venue, the caterers, the decorator, and so on. An instant wedding loan can help couples and families looking to keep their wedding costs down.
3. Home Renovation Loan
A home renovation loan is for people who want to fix up or improve their homes. This loan can cover costs like painting, new furniture, or remodelling. Home renovation loans often have lower interest rates and flexible repayment plans. They are a great way to upgrade your home without spending all your money at once.
4. Debt Consolidation Loan
Debt consolidation is the process of paying off multiple loans with a single loan. This can be a useful way to reduce your monthly payments and simplify your finances. There are a few different ways to consolidate debt, but the most common is to take out a personal loan. This can be a long-term loan from a lender like a bank or credit union, or an instant loan from a loan app.
5. Medical Loan
A medical loan is a type of personal loan that can be used to finance medical treatment and procedures. While most personal loans can be used for a variety of purposes, medical loans are specifically designed to cover the costs of medical care. Instant medical loans can be an attractive financing option for people who do not have health insurance or whose insurance does not cover the full cost of their medical treatment. They can also be a good choice for people who have high deductibles or copayments.
Eligibility Criteria for Getting Different Types of Personal Loan
To qualify for a loan from the CASHe loan app, applicants must meet the following conditions:
Employment Status
- Salaried Employees: Individuals who receive a regular salary from an employer.
- Self-Employed Individuals: Those who run their own business, which must have been operational for at least the past three years.
Age: Applicants must be between the ages of 23 and 58 years old.
Residency: Only residents of India are eligible to apply for the loan.
Loan Duration and Interest Rates
The interest rate for the personal loan varies depending on the loan tenure:
- 15 Days: The interest rate is approximately 1.5%.
- 30 Days: The interest rate is approximately 3.0%.
- 90 Days: The interest rate is 2.5% per month.
- 540 Days: The interest rate is 2.75% per month.
Longer loan tenures may have different interest rates, which are calculated on a per-month basis.
Also Read – How to Get a Personal Loan without a Salary Slip
Documents Required for all Types of Personal Loan
When you are applying for a personal loan, then you need to submit several key documents to verify your identity, address, and income. The required documents include:
Identity Proof
- PAN Card: Mandatory for financial transactions and identification.
- Aadhar Card: Essential for identity verification.
- Passport: Can be used for both identity and address proof.
- Driver’s Licence: Serves as an additional identity proof.
Address Proof
- Utility Bills: Recent electricity, phone, or maintenance bills.
Income Proof
- Bank Statements: Recent statements showing your salary credits.
- Salary Slips: Latest payslips from your employer to confirm your income.
These documents ensure that the lender can verify your eligibility and assess your financial stability for the loan approval process.
Factors to be Considered for Different Types of Personal Loans
When choosing a personal loan, think about these important factors:
- Interest Rates: Compare rates from different lenders to find the best one.
- Loan Tenure: Choose a repayment period that makes your monthly payments manageable.
- Processing Fees: Check if there are any fees for processing the loan.
- Prepayment and Foreclosure: See if there are penalties for paying off the loan early.
- Loan Amount: Make sure the loan amount is enough for your needs but also something you can repay comfortably.
How Personal Loan is Different from Other Types of Loans
Personal loans do not require any collateral, unlike home or car loans. They can be used for various purposes, and they usually have shorter repayment periods and higher interest rates than secured loans.
Also Read – 10 Questions to Ask Before You Take Out an Instant Personal Loan Online
Conclusion
Personal loans in India are useful for many needs. Knowing the different types, eligibility criteria, required documents, and important factors can help you choose the best loan for your situation.
Looking for a loan with a flexible repayment schedule and competitive interest rates? Download the CASHe app and apply now!
FAQs
1. Which type of personal loan is best for salaried?
A travel, two wheeler loan, instant personal loan, or a marriage loan is good for salaried people because their regular income helps manage the monthly payments easily.
2. Which type of personal loan is best for the self-employed?
A home renovation loan or debt consolidation loan is often best for self-employed people due to the flexible repayment options.
3. What are the different types of personal loans offered in India?
The different types of loans in India include travel loans, wedding loans, mobile loan, consumer durable loan, home renovation loans, debt consolidation loans, education loans, and medical loans.
4. How do I find the correct type of personal loan that suits my requirements?
Assess your financial needs, compare loan options, check eligibility criteria, and consider interest rates and repayment terms to find the right loan.
5. Which type of personal loan is easier to get?
Medical loans, marriage loans, or travel loans are usually easier to get because they have simple eligibility criteria and quick disbursal processes.
