Body: With an increase in the number of consumers taking personal loans for their purchases, especially expensive ones. They are also applying their purchases into equated monthly installments (EMIs).
What is Personal Loan?
A Personal Loan is an easy credit provided by financial institutions based on eligibility criteria. A Personal Loan, which is also known as a consumer loan is a multi-purpose loan therefore it can be used to meet any of your actual needs.
Here are a few benefits of personal loan:
No security is required:
There is no collateral of any asset required. It is given based on your credit records and payment capacity.
Quick loan disbursement:
If banks feel that you have the ability to repay the loan within the spell of time and need the loan for genuine reasons then getting a personal loan disbursement is easy.
Fixed-rate of interest over the tenure:
The rate of interest on personal loans is fixed at the start of the tenure. So, it grows simple for the loan candidates to prepare for their future EMIs well in approach.
Flexible loan tenure of around 1-5 years:
These loans offer loan duration covering from between 1 year to 5 years. So you have the versatility to pick your duration as per your payment plan. Best is to choose for a more moderate duration loan and save on the interest outlays.
Easy EMI facility is available:
Equated Monthly Instalments make the idea of loan simpler. Personal loans too offer easy EMI facilities and help you repay the principal amount over the term.
Documents required for Personal Loan:
Some of the important documents you must provide along with your application form include:
Proof of income (salary slip, bank account statement, ITR forms)
Residence proof and identity proof
Certified copy of your degrees and license
Personal Loan Eligibility Criteria are as follows:
Age Limit: If you are a salaried employee, then the age limit is 21-58 years. The age limit for a self-employed businessman or woman is 25-65 years.
Monthly Income: Some lending institutions have a minimum monthly income criterion. While at some banks the eligibility criteria are Rs 25, 000 per month.
Employment Term: If you have been job-hopping in the recent past, approval could be difficult.
Credit Score: This is a score given to you by your financial institution. It gives a prospective lending institution a perspective about your history as a borrower.
A high credit score also gives you the dealing power to make better loan terms for yourself.
The formula for determining EMI is as follows:
P = Principal loan sum
R = Rate of interest calculated monthly
For instance, if R = 15% per annum, then R= 15/12/100 = 0.0125; and
N = the number of monthly installments.
For example, if you borrow Rs 5,00,000 from a bank at 15% rate of interest for a term of 10 years then,
EMI = 500000*0.0125* (1+0.0125)36
(1+0.0067)36 – 1
EMI = Rs 17,333
Axis Bank’s Personal Loan EMI calculator is a helpful online automatic tool to determine how much will be your EMI outgo. It is remarkably easy to use. Axis Bank’s Personal Loan EMI calculator makes loan preparation easier for you.
These are the 5 advantages of practicing the EMI calculator:
Easy to obtain
Conserves time
Quick effects
Improves your certain EMI
Aids you in preparation.
Conclusion: Personal loans are one of the valuable forms of credit facility. So, act very judiciously and evade taking for loans for almost every possession. Focus on the bigger goals in life, such as purchasing a dream home, your children’s fate, and your retreat, apart from a host of other ones.
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