How To Get Different Types Of Loans?

Loan as per the finance is lending of money from one or more organizations, banks, or individuals. This debt is paid in a certain duration with a called-out amount of interest with the principal amount. Earlier in India, Various zamindars and big wealthy people used to give such loans without prior knowledge of interest to the poor and needy for the functioning of their livelihood. This then was either paid in return through the cash amount, service provided, or by exchange of goods. Since then, various ideation and changes took place with the introduction of the Reserve Bank of India in 1949. And know taking a loan is easy.

Consumers’ loans also significantly increase the economy, as the shortage of money tends consumers to take loans and in return pay interest for the same which profits the banks. This is how the flow works here.

Different Types Of Loans Available In India.

The loan is divided into two secured and unsecured which further contains various kinds of loans.

Unsecured Loans

This type of loan does not look into the fact and background checks about your method to pay the debt or your income source. They are usually a little expensive. Two types of loans come under this category.

  • Personal loan.

One can opt for a personal loan to fulfill their requirements either education or marriage etc. The growth and hype of taking such kinds of loans showed a 27% increase from 2015-to 2018. 

  • Small Business Loan 

This is a good way to start your business from the starting phase either to launch your prototype or hire staff. The benefits of such loans are that it is transacted to your accounts within 24-48 hrs and you can range the repayment from 12-60 months.

Secured loans

Such kinds of loans ask for assets or security while borrowing money. They keep your asset as collateral to keep if you by any chance fail to pay that sum of amount. Again this category has three kinds of loans.

  • Home Loan

You must have heard of it before, such kinds of loan has a longer repayment tenure so that it does not stress the financial conditions.

  • Loan Against Property

This kind of loan keeps your property as a mortgage against the amount you ask for. The amount ranges as per the rate of your property’s 60-70% value.

  • Loan Against Security

The consumer capitalize their investments funds to take a certain amount of loan. 

How To Get a Personal Loan In 05 Easy Steps?

Step 1: Figure out what is your ask amount. Whether that amount is enough for you to get back on track? Will I be able to pay that set of amounts all by myself? These questions should be answered before getting into the decision.

Step 2: Have a look up at your debt-to-income ratio and also to credit score once the decision is made.

Step 3: Pre-qualify and gather all necessary documents such as KYC, Adhar Card, salary slips, savings account statements, a copy of income tax, and other documents as per the banks’ requirements. 

Step 4: Check the fees and interest carefully and calculate the amount to ask and duration to pay it wisely. This decision should be in a calm manner. 

Step 5: After the documentation is done your bank checks the documents and allows a loan as per your requirements. 

Top 10 Personal Loan Finance Companies In India.

Companies Interest Rate Age Range Loan Amount
HDFC Bank 10.50%-21.00% p.a 21-60 yrs Upto Rs. 15lakh
TurboLoan 15% p.a. 21-60 yrs up to Rs. 5 lakh
SBI Bank 9.75-10.25% p.a. 21-76 yrs
Rs. 25,000 – Rs. 4 lakh
PNB 8.75-14.25% p.a. 21-60 yrs
up to Rs. 10 lakh
Axis Bank 12-21% p.a. 21-60 yrs
up to Rs. 15 lakhs

How To Apply For A Home Loan In 09 Easy Steps?

Step 1: Fill out the loan application form and submit the required documents like personal details, bank details, education information, employment details, property cost estimation, and details.

Step 2: Pay the fees, however, there are quite a few banks that do not take such charges in the other hand they charge afterward with higher interest, stamp duties, and legal charges.

Step 3: Discussion with the bank is done while visiting and explaining the situation that made you apply for the loan and what kind of loan might be a good option and with that verification of documents is done through the bank. Here bank examines all your submitted files and approves.

Step 4: Then the bank approves the loan. Bank usually examines based on a few criteria like qualification age, transaction made with a bank, any illegal activity mentioned in past, type of job, ability to repay the loan.

Step 5: Certified offer letter is further issued which contains the details of the loan amount, interest cut in the amount, duration of repaying, and such other terms and conditions. Then the acceptance copy is received by the consumer.

Step 6: Legal check for property papers, once the property is selected. The bank checks and authenticates the papers and approves. 

Step 7: Once the papers are made the site is checked and the property values are evaluated, this is done because alot of malpracticse happens and to reduce risk. 

Step 8: Final loan deal, when the technical and onsite checking is done the lawyers approve the paperwork and proceed to final processing of the loan. 

Step 9: When the applicants sign the agreement with a prior understanding of all terms and conditions, then the loan is sanctioned. The cheque is received within that time. 

Top 5 Housing Finance Banks In India

Companies Interest rate Loan-to-value ratio Cons
ICICI 6.90%-11.6% 90%
There is no chance of EMI decrease, when once increased.
SBI 7.35%-7.70% 90%
Bank has it’s programming approval a little slow.
HDFC 7.40%-8.20% 75-90%
Charges of re-appraisal of loan.
Axis Bank 12% 75-90%
Various charges on documentation are charged.
Union Bank 11.4%-12.65% 75-90%
Unavailability of top-up loans.

Points to remember while seeking for loan.

  1. Have a thorough research on banks and loans while looking for a perfect match.
  2. Read the bank’s eligibility criteria and asked terms and conditions very carefully. A small mistake may trouble you in the future.
  3. Always carry the required documents related to your personal and employment information with you handy.
  4. Make sure the copy is accurate and there are no fake documents anywhere punched.
  5. When you have face-to-face interaction with the bank service provider employees make sure to clear all your queries.
  6. Just because you are applicable for a loan doesn’t mean your ask amount should be more than what you might not be able to pay.
  7. Always try to negotiate the interest rate and explain the situation or reason behind the loan. 
  8. Make sure you check all the legal papers before signing.

Bottom line

The loan procedure for other criteria loans is the same. More or less the verification might be different. This may differ from one bank to another as per the facility it provides. Hence, knowing the amount to ask and the ability to pay back with the assured interest is the only way to get the loan. Always remember the points discussed above. 

Shivangi Singh
Shivangi Singh

I am currently pursuing my Bachelor's in Aerospace Engineering in my final year at the University of Petroleum and Energy Studies. I like to read books and learn new things that help me in my overall growth. I am a people person and love to know and interact with new people. I also like to visit new places and learn about its culture, food and history.

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