One of the most stressful things that could happen to you financially is not having enough money when you need it urgently. One option is to borrow from your family and friends, but a better option would be to apply for an unsecured personal loan.
Instant personal loans can help you meet your financial requirements without disturbing your current investments or dipping into your savings.
6 Features of Unsecured Personal Loans
- No Collateral Required
Personal loans are unsecured and collateral-free. You don’t even need a guarantor when you apply.
All this reduces the processing time and paperwork. If you have a good credit score and the lender finds you to be a good borrower, they will be approved for a personal loan with the best loan terms.
- Flexible Usage
A home loan has to be used to buy a property, an auto loan to buy a car, or bike. You cannot use these loans for any other purpose than the one they were approved for. However, there are no restrictions on how you can spend an unsecured loan like a personal loan.
You have the freedom to use the loan money any way you want. You can use it to fund your travel, cover marriage expenses, buy consumer durable, and consolidate debt.
- Fast Approval
The processing time of unsecured loans is reduced significantly since collateral is not required. If you meet the lender’s eligibility criteria and have a good credit score, your loan amount can get approved within 72 hours.
In fact, some NBFCs disburse the loan amount into your bank account within 24 hours. Certain banks provide the facility of online approval of the personal loan for their existing customers.
- Flexible Tenure
Unsecured loans offer flexible borrowing and repayment options, which makes them attractive.
Many lenders provide you a wide tenure to repay the loan amount. It can range from 12 months to 7 years. This gives you the flexibility to choose a tenure that works the best for you.
If you choose a long tenure, the EMI amount will be low, and a shorter tenure means higher EMI amounts. You can use an EMI calculator to calculate the EMI amount you are comfortable paying. Based on that, you can choose a tenure which suits you the best.
- Fixed-Rate of Interest
Personal loans are available on a fixed rate of interest. This means that the EMIs will remain fixed for the entire tenure of the personal loan.
This eliminates the worry of change in interest rates over the tenure.
- Minimum Documentation Requirements
The documentation requirements for applying an unsecured personal loan are minimum. For instance, some basic documents required are KYC documents, bank account statements of previous months, proof of employment, and salary slips.
Concluding Words
Most of the lenders consider your credit score before giving you an unsecured loan. So, make sure you have a high credit score before you apply. You must also meet the eligibility criteria of the lender.
Author Bio:
Shiv Nanda is a financial analyst who currently lives in Bangalore (refusing to acknowledge the name change) and works with MoneyTap, India's first app-based credit-line. Shiv is a true finance geek, and his friends love that. They always rely on him for advice on their investment choices, budgeting skills, personal financial matters, and when they want to get a loan. He has made it his life's mission to help and educate people on various financial topics, so email him your questions at shiv@moneytap.com.
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