Read on to know the 7 important things you should know about personal loans:
No guarantee: Normally the lenders require the personal guarantee of a creditworthy person while giving a loan. But in the case of personal loans, no banks ask for a personal guarantee.
Interest and charges: The interest rates differ from bank to bank. Also note that various charges like processing fee, foreclosure charges etc. are basic factors you should check and compare. Sites like www.nettivipit.fi provide full details of personal loans offered by different banks. Hence comparison job is made easy. Always select the loan where the interest and charges are reasonable.
Fast processing: It is the speediest type of loan which is processed so quickly, and the amount is credited to your bank account. The time can range from minutes to 1-2 days depending on the bank you choose. There are few types of loans which will take high processing time. Normally people get loans only to meet urgent needs. When the loan processing is delayed the very purpose of taking the loan may not be met.
Loan amount: Please note that the personal loan amount is based on your income level. The higher the income the higher the eligible amount. Also, you should have a good credit history and rating.
No end use stipulation: Personal loan does not restrict usage of the funds for the selected purpose. You can take a personal loan for any purpose- education, travel, buying a home, wedding expenses etc. Hence the flexibility factor is high.
No complex documentation: Like a few types of loans, personal loans do not involve complicated loan documents. Simple KYC documents like address and identity proof and income proof are all are needed.
No security: These loans do not require the backing of an asset to be mortgaged as security.