A personal loan is your financial best friend. It is a type of unsecured loan, meaning borrowers do not need any collateral or security to apply for them. It can be used for various purposes like debt consolidation, home purchase/construction, education, etc. The application process is rather simple; borrowers just need to meet the eligibility criteria, and with minimal documentation, the loan will be theirs.
The documents that are generally required are identity proof, address proof, and bank statements. Further approval and documentation depend on the borrowers’ credit score, income, employment type, and debt-to-income ratio. Ultimately, they are a versatile financial tool that one can use smartly to achieve their goals and aspirations.
Personalisation makes everything better, whether it’s a personal car, space, or time. This extends to finances as well, where the freedom to spend as desired—whether on a vacation, a new gadget, or alleviating financial debt—brings satisfaction. Personal loans offer this flexibility, and with a suitable personal loan interest rate, they become even more accessible and manageable. Below, we will explore what instant personal loans are and how to apply for them, so they can be used to fulfil various financial obligations and dreams.
What is a Personal Loan?
An instant personal loan refers to an unsecured credit provided to the borrower without collateral or security. Unlike other loans, such as housing, business, or car loans, personal loans, also known as consumer loans, are multi-purpose loans that can be used to meet any immediate needs.
Whether for an international holiday, a child’s education, or home renovation, they are not designed for a specific purpose. Financial institutions provide these loans based on criteria such as employment history, repayment capacity, income level, profession, and credit history.
As for the interest rate, personal loans can be secured with fixed interest rates, ensuring consistency throughout the loan term, unaffected by market fluctuations.
How to Apply for a Personal Loan?
The process of obtaining a personal loan is simpler for borrowers who meet the eligibility criteria set by the lender based on their credit profile. Personal loans usually require minimal online documentation, making the process less cumbersome. So, let’s explore what documents are needed for an online instant personal loan.
Documents for Personal Loan
The documents required to avail of personal loans are as follows:
Standard Documents
1. Identity proof (Aadhaar card, Driving license, Voter ID card).
2. Address proof (Passport, Utility bills, Aadhaar card, Voter ID card)
3. Bank statement for the last 3 months (Passbook of the previous 6 months)
Documents for Salaried Applicants
1. Salary slips for the last 3 months
2. Form 16 or Income Tax Return
Documents for Self-Employed Applicants
1. Income Proof
2. Business Proof
3. Proof of Office Address and Ownership
Prospective borrowers can make an online application for instant personal loans by visiting the desired lender’s website, clicking on the Personal Loan option under the services tab, selecting the “Apply now” tab under the Personal Loan EMI Calculator section, and choosing the “Apply loan online” option. Individuals can also visit any of the official branches to make a personal loan application in person.
Overall, a personal loan is a versatile financial tool. Available for both salaried and self-employed individuals, borrowers can use the loan amount to cover any of their expenses, whether related to travel, home purchase/construction, education, financial/medical exigencies, debt consolidation, etc.
