Personal Loan Rules : Often when you do not have money at the time of sudden expenses, then you may have to take the help of personal loan. Often people have very little knowledge about the rules and other features associated with personal loans. In such a situation, it is very important to know about the special aspects related to them. Personal loans are unsecured loans. That is, in lieu of this, nothing is mortgaged to you. Home loan and car loan have a definite purpose but personal loan is taken to meet any kind of expenses.
Smartcoin Rohit Garg, Co-Founder and CEO, says that there are many misconceptions about personal loans because of the ease of getting things without collateral. Generally, people are surrounded by apprehension and distrust at the time of applying for a personal loan. Therefore, it is important to clarify these concepts related to personal loans. Let us know what is the exact situation.
1. Personal loan rates are not very high
It is often seen among people that personal loan rates are very high. but it’s not like that. Financial institutions, banks or other lending companies decide the rate of interest on your CIBIL score. If you have a good this score and your repayment capacity is strong, then you get a loan at a lower rate.
2. Not only salary earners can take personal loan
It is a common belief that only salaried people can apply for a personal loan. but it’s not like that. Any self-employed or a person running his own business can apply for a personal loan. His loan approval depends on his credit history.
3. Personal Loan can be repaid even before time
You cannot repay the personal loan before the end of its tenure. This is a misconception. Personal loan has a pre-payment option. Personal loan can be pre-paid by paying a small foreclosure charge. Anyway, it is better to repay the loan as soon as possible. This eliminates your EMI burden.
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4. Apart from banks, NBFCs, finance companies also give loans
Many people believe that personal loans can be obtained only from banks. But it is not correct. All NBFC companies and digital finance companies offer personal loans. Digital loan provider companies give loans with less paperwork. Their terms are also easy.
5. Processing fee of personal loan is not high
There is a common perception that the processing fee of a personal loan is high. But it is not correct. The processing fee is as normal as the normal loan given in the banks. Personal loans are unsecured loans. That is, nothing is mortgaged to you in return. Usually your loan gets approved within two to seven working days of applying. However, before taking a loan, you should definitely compare the interest rates of different banks and companies.
(Article : Priyadarshini Majhi)