As long as you are earning a monthly salary, you need not stress out regarding emergency cash crunches. No matter what your purpose, it is easy to get a personal loan in quick time. The best part of a personal loan is the simple eligibility criteria that provide an opportunity to millions of working professionals.
Why would you need a personal loan?
Unlike specific purpose loans like Home Loan or Vehicle Loan, personal loans are versatile and can be borrowed for any purpose. A financial emergency could be due to any reason. It could be a medical emergency, a big-ticket purchase like an electric car or a phone or home appliance, a wedding, a vacation, an investment opportunity or clearing off past debts. Whatever be your need, you can cover it through a personal loan against your salary.
Why are personal loans so popular?
Personal loans are popular because of a variety of reasons like –
No collateral
Personal loans are unsecured loans meaning they do not require you to pledge any asset. This makes it very convenient for salaried young professionals to borrow against their monthly paychecks. Young salaried employees would not have sufficient assets to pledge against the loan and would find it difficult to opt for secured loans. Personal loans save them from this awkward situation and it can be a real godsend when the fund requirement is immediate.
Fast processing
Unlike traditional loans which may take days or even weeks for processing, personal loans are processed within a day or two. This is a great relief because it can be used even in an emergency when the funds are required within a very short time. It is the speed of processing a personal loan that places it as a viable alternative to a credit card.
Minimum paperwork
The thought of filling up multiple forms in triplicate and attaching photocopies of various documents puts off new borrowers. Luckily, the personal loan procedure is quite customer-friendly and eliminates this pain. You are simply required to fill an online application form and upload the mandatory documents. The loan assessment is also completed electronically and the approved loan is disbursed to the mandated account.
Cheaper than credit cards
Did you know that credit cards charge anywhere between 2 to 3 % per month on the outstanding balance? This works out to a whopping 24-36% on an annual basis. Compared to these rates, personal loans charge lower interest rates and offer a structured repayment plan that suits your requirements.
No prepayment penalty after 6 months
Once you service the loan for 6 months, you can choose to prepay the loan in full or in part without any prepayment penalty. This gives a lot of flexibility to borrowers. They can opt for a longer tenure, in the beginning, to keep the EMI low but can foreclose the loan after 6 months if their financial circumstances change.
How can I get a personal loan against my salary?
If you have been employed for more than 6 months, your credit history would have been generated and you would have a CIBIL score. This will allow you to get a personal loan if you fulfil the basic eligibility criteria for personal loan.
You can apply for personal loan if you are an Indian citizen or resident over the age of 21 years and earn a net take-home salary of over Rs 30,000 per month.
The procedure at LoanTap is given below :
All you need to do is to fill up an online application form and upload the following documents –
- PAN Card
- Aadhaar Card
- Salary slips for the last 3 months
- Bank statement of the salary account for the last 6 months
The LoanTap team will evaluate your application. Your credit score will be considered as well as the reputation of your employer, years of work and the existence of other loans. If everything is found satisfactory, your loan will be approved and the amount disbursed to your mandated account. The entire process will not take more than 24-36 hours.
LoanTap offers personal loans in the range of Rs 50,000 – Rs 10,00,000 for tenures ranging from 6 months to 5 years. Interest rates start at 18% per annum. After paying the EMI for six months, you have the flexibility to foreclose the loan without any prepayment penalty. LoanTap offers several repayment options to choose from based on your financial situation.
Getting a personal loan against your salary is quite a convenient option that can be used whenever you have an urgent and immediate need for money. Remember taking a loan for discretionary expenses is not desirable behaviour nor does it display financial prudence. You could easily be swept into the vicious debt cycle where one debt is replaced by another.
On the other hand, if you plan wisely and keep your debt limited, you will have the freedom to apply for a personal loan whenever the situation arises. Your credit score will be maintained at high levels and you will be able to get better interest rates from lenders. You can work out better terms for your personal loan based on where you work and the years of experience you have.. Keeping the powder dry is not a bad thing for it will give you better leverage when the situation calls for it.
So, whether it is an investment opportunity or a dream home or an electric vehicle or even a hair transplant, you can use a personal loan to fund that expense and repay it in easy monthly instalments. Getting a job with a reputed employer and keeping tight control on the frivolous debt will give you the opportunity to avail of a personal loan when the situation demands it. Remember, no matter what your need, we, at LoanTap understand your situation and have tailor-made solutions. All you need to do is to visit our website and fill out the application. It is that simple! We are only a few clicks away whenever you need us.
Related article – How much loan can I get in my Salary?
