Basic Questions About Personal Loans Asked By Borrowers - Personal Loan Blog - Tata Capital

Basic Questions About Personal Loans Asked By Borrowers

Feb 28, 2017

Personal loans, in the recent years, have become the most sought-after financial aid for a variety of purposes ranging from planning an overseas vacation to paying for a wedding. The biggest advantage of personal loans is the flexibility of using the money as you wish without providing a security or obtaining a guarantor. With the rising popularity and increasing queries about personal loans, here are some common questions answered for your convenience.

How much can I borrow?

Lenders offer personal loans ranging from Rs. 10,000 to 30,00,000. The loan amount for each individual case is based on the sole discretion of the lender you choose.

What is the tenure for personal loan?

The tenure varies from lender to lender and can range from one year to five years.

How are personal loan amount and interest rates determined?

The loan amount depends mainly on your income along with others such as your age, credit history and profession. To improve your personal loan eligibility, you can also club the income of your spouse during application. Interest rates vary as per lender, your profession and credit history. Borrowers working at a reputed firm can obtain lower interest rates whereas self-employed people get a higher rate.

Are there other charges besides interest rates?

Absolutely. Lenders charge additional fee with the personal loan such as processing fee and documentation fee. Prior to agreeing on T&C, you must read the documents carefully and in some cases, negotiate the charges. Moreover, there are service taxes on interest payments as well as additional charges.

Can I pre-close a personal loan?

Some lenders offer the flexibility to pre-pay the loan after six months of disbursement as per the guidelines on the prepayment amount. And there are some who allow borrowers to close the loan within 30 days of disbursement with additional terms and conditions.

How do I avail a personal loan?

To apply for a personal loan, you can simply walk into the office of the lender. Alternatively, you can visit the website of the lender and apply for a personal loan online.