Recognising the sacrifice, service, and contribution to civilian safety, lending institutions offer a special loan for defence personnel. The aim is to help military personnel realise their financial goals. Lenders ensure that individuals who served in the Navy, Army, and the Air Force don’t have a tough time resurrecting their life outside their job.
In this article, we’ll look at the benefits of a personal credit facility for defence personnel.
Covers a broad range of individuals
Typically, lenders offer military personal loans for a wide range of personnel. This includes individuals working in the Airforce, Army, Navy, Paramilitary, along with those employed with CRPF, CISF, BSF, SSB, ITBP, and veterans.
Offers unrestricted end-use
A loan for military personnel has no restrictions on its end use. This means borrowers can choose to use the funds to finance a business idea, foreign trip, tend to medical expenses, take care of home renovation charges or wedding expenditures, and more. Here are a few crucial expenses, you can cover with a loan:
#1 Debt consolidation
If keeping track of multiple loan instalments has become a challenge, consolidate your existing loans into one. Yes! Consolidate your debt and clear your dues comfortably with a loan. This way, you reduce your EMI burden significantly.
Besides, if you have a high credit or CIBIL score, you may even qualify for a low-cost loan. This is better than servicing multiple high-interest loans.
#2 Start a small business
As a veteran, if you’re looking into ways to earn a consistent income post-retirement, you can don the entrepreneurial hat. Besides a strong business idea, funds are key to laying the foundation for your venture. With a personal loan, you can easily get the funds to realise your entrepreneurial dream.
#3 Cover relocation charges
Whether you are relocating with your family during service or after, packing and moving can be a costly affair. You need to take care of transportation charges, brokerage charges, auto transfer expenses, and a slew of other expenditures. Besides, you will buy new home essentials and pay a security deposit for your rental home. To ensure that relocating is easy on your pockets, you can use a loan.
#4 Make a down payment
Thinking of booking your dream house? Put down a sizeable down payment for the property you want to buy with a loan.
Typically, personal finance is collateral-free, which means as defence personnel, you don’t have to put down security or pledge an asset as collateral. This way, borrowers can apply for personal finance and access the funds without worrying about losing an asset as a deposit. Moreover, nowadays, competitive personal loan interest rates are available in the market.
Instant access to funds
Unlike other loans, a personal loan eligibility criteria are easy, and you can apply online with the necessary details and paperwork to get swift approval. Personal finance online applications are approved within minutes of submission.
Exciting personal loan tax benefits
Depending on how you use the loan amount, you can claim a personal loan tax benefit. The government extends tax deductions if you take a personal loan for specific purposes like business expansion, education, buying or renovating a house, etc. Here’s how you can avail of personal loan benefits while paying taxes-
You can enjoy personal loan benefits if you are using the loan to make the down payment on a new house or renovate an existing one. You can claim tax deductions on the interest amount under section 24(B) of the Income Tax Act.
If you are taking a personal loan for business purposes, the interest increases the cost of acquisition. This reduces your capital gains, ultimately lowering your tax liability.
Personal loan eligibility criteria
Besides a ton of personal loan benefits, defence personnel can also enjoy simple eligibility criteria. The eligibility for a personal loan depends on multiple factors such as your age, income, credit score, repayment ability, etc. and varies from lender to lender.
However, some common eligibility criteria include-
- Your age must be between 22 and 58 years.
- You must have a minimum monthly income of Rs. 15,000.
- You must have a minimum of one year of employment stability.
- You must have a decent credit score.
Looking for personal finance from a reliable lender? Turn to Tata Capital. Use our personal loan EMI calculator to plan a comfortable repayment!