A personal loan can help you sort your financial emergencies and cover significant expenses like home renovations, educational costs, or planning a wedding.
To optimize your use of the loan, here are the top benefits to look for in the lending bank you choose.
7 Personal Loan Benefits that the Right Bank Must Offer
#1 – A Flexible Repayment Tenure
A good bank must offer a flexible tenure of at least 60 months to repay a personal loan. Then you won’t feel any pressure to make regular EMI payments and clear them quickly within the tenure.
#2 – Low-Interest Rates
Choose the best bank offering low interest rates on personal loans and better rates if you draw a significant income and/or work at a reputed organization.
This can give you the following benefits:
- The lower the interest rate, the more conveniently you can pay the EMIs.
- With regular loan repayments, you can build trust in your relationship with the bank to get attractive interest rates on future loans too!
#3 – Balance Transfers at Low Rates
Did you know that a low debt-to-income (DTI) ratio can increase the chances of loan approval at competitive interest rates? You can lower the DTI ratio by reducing your existing financial liabilities. For that, choose a bank offering balance transfers of current personal loans and credit cards at reasonable rates.
#4 – Simple Eligibility Criteria
Some banks set simple eligibility criteria for personal loans so you can easily qualify for them and use them to finance your needs. You just need to be:
- 25-65 years old as a self-employed person or 23-60 years old as a salaried individual
- Running your work or business for at least 3 years
#5 – Easy Processing of Loans
The best bank makes the processing of personal loans super-fast and easy. For that, you’re allowed to apply online for a loan using the website or loan app of the bank. This gives you the following benefits:
- The application process becomes paperless since it is digitized.
- There’s no need to provide any collateral as a security for loan repayment.
- You can get a personal loan approval in a few minutes once you meet the eligibility criteria.
#6 – Hassle-free Documentation
A bank facilitating digital processing of loans makes the document verification process hassle-free too! So, you can just upload the soft copies of the necessary documents online while filling the application form.
Plus, such a bank usually asks for only a few standard documents like:
- An income proof (income tax returns, etc.)
- An ID and address proof (Aadhar card, etc.)
- 3 months’ banking statement
- A debit card or Net Banking details for setting up an e-Mandate
- An e-Sign or e-Stamp for quicker disbursal
#7 – Quick Disbursal
Once a personal loan is approved, a good bank disburses it super-quick to your account so that you can start using the loan right away.
You can also do your bit to get certain benefits on personal loans, like a low interest rate. Maintain a high credit score with a good credit history to enjoy better interest rates!