The 20s are the best years of anyone’s life. Free from the shackles of ‘childhood’ and stepping into the world of adults is an exciting high. One finishes studies and gets a job, and financial independence goes a long way in making life fantastic in many ways. It’s a time of partying, making new friends, finding The One and also jumping careers to find emotional and financial fulfilment.
When one is in their 20s, they feel invincible…like nothing can ever go wrong. One is confident and able to take negative developments in one’s stride. But when one has just started working, one may not have a very high starting salary. As a result, the monthly income often runs out before the month ends! Those who take charge of their financial lives in this decade are the ones that are able to make the right decisions later, when they have families and many people depending on their income.
Then there are times when you have a dream that you want to fulfil, but lack of money stops you from doing so. It could be anything, but it matters to you. The good news is that there is a way to make your dream come true right now – with the help of a personal loan.
So why should I take a personal loan? How does it benefit me?
Taking a personal loan solves many urgent financial conundrums. You may need money to fund a medical procedure. Or you may have credit card debt. Or you may wish to conduct home repairs. On the other end of the spectrum, you might want to enjoy your life before the 30s arrive and you must buckle down and get more serious. You might wish to study a new skill, or get married in a fancy location, or even go backpacking across Barcelona. A personal loan helps you fund your dream now, rather than later.
This is how taking a personal loan benefits you:
You can borrow as much as you need. There is no restriction (save for your eligibility) on how much money you can borrow. It can be a few thousand Rupees or a few lakhs. The only points to note are how much interest you are being charged on it, and whether you are allowed to transfer the loan to another bank if the latter offers lower rate of interest.
It is disbursed quickly. Once the lending institution receives your loan application and approves it, the loan monies are disbursed within a few hours. In fact, all the banks allow customers to apply for the personal loan online. This makes it the process even quicker – it is a major factor when you need a large fund of money for an emergency requirement.
It does not require collateral. The personal loan is unlike other loans like home loans, which require collateral. In the personal loan, the lending institutions offers the loan basis the applicant’s income and credit profile only. However, this makes the loan a little costlier than home loans, car loans, mortgage loans and loans against property. This is because the rate of interest on this category of loan is a little higher.
The lender approves the loan basis your eligibility only, not the purpose of using the loan. The best thing about taking a personal loan is that you don’t need to justify its end use. For example, you might want to borrow the loan to buy that gorgeous curved LED TV for your home theatre, or to book a month-long vacation to Europe. Every need is counted as a legitimate one, and the lender only checks your eligibility and repayment capability before approving the loan. You don’t even need to state why you need the loan – just apply, get approval, and have the loan disbursed to you!
But wait – what is loan eligibility?
This is the most important factor to be considered when basing your assumptions about the amount of money you need. For example, you might make a monthly income of Rs 50,000 and require a loan amount of Rs 6,00,000. However, it is not necessary that you will get the entire loan amount that you desire – because a factor called ‘personal loan eligibility’ comes into play.
Simply put, it is the bank or financial institution’s calculation for the amount of money that you can expect to get. It is calculated basis your age, income, occupation, place of residence, current loans, etc. This number is more or less constant across all lending institutions. Thus, it makes sense to compute it before you make the application, so that your plans do not go awry.
You can easily find out your personal loan eligibility by using your bank’s online eligibility calculator. You can forge ahead with your plans once you are aware of how much money you can expect to get.
So now I know my loan eligibility. What’s next?
The next step is to apply for the personal loan. You can do this online – just look up ‘Personal loans’ on your bank’s website to get started. Once you fill out the personal loan eligibility calculator –
* The bank studies the information you entered in the eligibility form. Basis this information, the bank contacts you to understand your requirement better.
* The bank sends a detailed application form on email. Fill out this form with the latest and most accurate information. Attach self-attested proofs of age, income and residence with this form.
* Once the bank approves the loan, it is disbursed to you in the form of cheque or directly to your bank account, in just a few hours.
* You start repaying the loan from the next month, with the EMI debited directly from your account.