M9: Personal Loan

• a lump sum of money borrowed from a financial

  institution that can be used for almost any purpose.

  Personal Loan
• can be offered by banks, credit unions, or online lenders.

  The money you borrow must be repaid overtime, typically with interest. It can vary greatly when it comes to their interest rates, fees, amounts and repayment

  terms.

  Personal Loans
• is one that requires some type of collateral as

  a condition of borrowing such as your car or savings account and its value could affect how much you’re eligible to borrow. It could be easier to get since your collateral lessens the risk for lenders.

  Secured Personal Loan
• Types of Personal Loan

  Secured Personal Loan and Unsecured Personal Loan
• is usually an item of value which is given to the lender if

  the borrower cannot make repayments

  Collateral
• requires no collateral to borrow money. Are

  harder to obtain and interest rates can be higher, as lenders rely heavily on your credit and other financial information to determine your loan eligibility.

  Unsecured Personal Loan
• PROs of Personal Loan

  Less Documentation

  Fast Processing & Approvals

  Low Interest Rates

  Loan Tenure
• PROs of Personal Loan

  Less Documentation

  Fast Processing & Approvals

  Low Interest Rates

  Loan Tenure
• There is no need to provide any sort of guarantee with your

  assets. This is also a reason why most banks and financiali nstitutions sanction these loans without much documentation.

  Less Documentation
• The processing time for the loan is considerably reduced.

  Therefore, you can get such a loan within a day or within a

  week, depending on the amount being borrowed.

  Fast Processing & Approvals
• It makes even easier that there are no middlemen involved

  Low Interest Rates
• Depending upon the amount borrowed, the loan tenure would range from one to five years. It would be agood ides, however, to look out for special schemes and offers to take advantage of when seeking such a loan.

  Loan Tenure
• CONs of Personal Loan

  Can be more expensive

  Might come with fees

  Rates may be higher than other financing option

  Potentially high monthly payments
• You’ll pay interest on the full loan amount from the start, which could result in more interest charges compared to a personal line of credit.

  Can be more expensive
• Some personal loan lenders charge a upfront origination fee, which can be costly and reduce how much you actually receive.

  Might come with fees
• It’s important to compare all your financing options before

  getting a personal loan.

  Rates may be higher than other financing options 
• Depending on how much you borrow and the length of your

  repayment term, your monthly loan payment could be higher than the minimum payment on a credit card

  Potentially high monthly payments
• Features of Personal Loan

  Interest rate

  Repayment

  Minimal paperworks

  Tenure

  No collateral
• interest rate of personal loan is comparatively higher than

  other loan but the increasing competition among competitors give benefit to you to choose the bank with less interest rate .

  Interest rate
• repaying personal is easy because of the convenient options available for you such as post dated cheques.

  Repayment
• getting the best personal loan is easier than other loans because banks understand the urgent need of their customers and they do the approval quickly. Most of the banks process the loan request within 48 hours.

  Minimal paperworks
• Benefits of Personal Loans

  Flexibility & Versatility

  Lower interest rates & high borrowing limits

  No collateral requirement

  Easier to manage

  Higher payments than credit cards
• some types of loans can only be used for a certain purpose. But personal loan can be used for many purposes.

  Flexibility & Versatility
• consumers with excellent credit history can qualify for personal rates


  Lower interest rates & higher borrowing limits
• unsecured personal loans don’t require collateral for you to get approved. Meaning you don’t have to put your car, home or other asset as a guarantee that you’ll repay the funds.

  No collateral requirement
• a personal loan with a single, fixed rate monthly payment is easier to manage than several credit cards with different interest rates.

  Easier to manage
• credit cards come with small minimum monthly payments and no deadline for paying your balance off in full. Personal loans require a higher fixed monthly payment and have to be paid off by the end of the loan term.

  Higher payments than credit cards
• Process of Applying for Personal Loan

  Filling up loan application form

  Finalizing your loan paperwork

  Loan repayment schedule
• to get personal loan, you need to apply to a lender. This can be a bank, credit union, or online personal loan lender. Then complete an application form.

  Filling up loan application form
• the lender reviews it and decides whether to approve or deny it. If approved, you’ll be given the loan forms which you can accept or reject.

  Finalizing your loan paperwork
• once accepted, the lender will fund the loan which means paying the proceeds to you which may be done thru a direct deposit into your bank account or may be done thru a cheque. Then have to begin repaying the loan according to the terms established in your loan agreement.

  Loan repayment schedule
• Personal loans help you to take care of your immediate requirements without much of a hassle. The most attractive feature of the personal loan is that you do not have to give any kind of security to avail this loan. No, security, collateral or guarantors are required to avail personal loans. Also, no questions regarding the end use of the loan are asked since personal loans do not require any security of assets, the rate of interest charged by them is higher compared to any other secured loans.
• When you really need cash for emergencies, a personal loan can be a life-saver. Just find the best loan for your needs and income with the lowest interest rate. Remember to try to pay off the amount as quickly as possible too.
• Remember to compare lenders to see where the best personal loan terms can be found. And of course, read the fine print carefully before signing off on a personal loan to make sure you understand the repayment details and the cost of borrowing.