A personal loan is an amount taken from a bank or non-banks by an individual for his personal needs. This loan is an unsecured form taken fo to meet the emergency needs of an individual. An individual who needs urgent money has to approach a bank or any financial firm for securing personal loans. The personal loan is delivered to any person for interest on a monthly basis. The rate of interest varies from one firm to another firm and hence the individual needs to check the rate before securing a loan to his needs. However, each bank would have its own eligibility conditions for disbursing personal loans.
The eligibility criteria of an individual who applies for the personal loan should meet the standards. The various requirements expected from an individual to get the loan are salaried details or income of the person, credit score details, and repayment capacity. These basic details are checked by the loan delivering finance institutions before relating the loan. The term of the loan is predecided by the person and the bank as per norms. Every month the person has to pay some interest along with the principal amount to the lender. If any lapse on paying EMI by the individual, the penalty will be levied by the money lenders.
The person who avail of personal loan usually gets a loan at a higher rate of interest than other loan interest. This has to be well understood by the customer. If the repayment is not good by the person, then the individuals’ credit score is affected badly. The repayment of personal loans is also decided based on the age of the person and his occupation. Another condition of the bank is that the loan has to be repeated fully within a period of time they frame while availing the loan.