Personal loans are known for their versatility to provide quick cash for a variety of requirements, like marriage, travel, education, home renovation, debt consolidation and medical needs. One can also avail a personal loan in the case of a financial emergency. These loans require zero collateral, and are also equipped with overdraft facilities. What’s more, the personal loan interest rates are affordable and the repayment tenure is also flexible.
Additionally, personal loans are equipped with simple eligibility conditions: one must be at least 22 years of age with a monthly income of Rs 15,000 with a good CIBIL score. Personal loan eligibility is also influenced by factors like job stability and work experience. In fact anyone applying for a personal loan has to provide an employment certificate, mentioning one year of continuous employment. While availing a personal loan, one has to provide documentation for proof of identity and residence along with salary slips for the last three months. The maximum loan limit is capped at Rs 25 lakhs.
Personal loan EMI calculator: This is an online tool which allows you to calculate the Equated Monthly Installments (EMIs) that are required to be paid as principal and interest payment throughout the tenure of the loan. Anyone applying for a personal loan can use the personal loan EMI calculator to calculate the EMIs instantly. This ensures that one can plan the monthly installments, and repay the loan with convenience.
Understanding foreclosure of a personal loan: Anyone applying for a personal loan must know that personal loans are equipped with the key feature of foreclosure or pre-payment. Personal loans, however, have a minimum lock-in period of 6 months. After the lock-in period is over, one can foreclose the loan; either in part or full after paying certain foreclosure charges. A borrower must remember that no foreclosure charges are applicable on loans with floating interest rates.
If any borrower forecloses the personal loan within six months after completing part pre-payment, a foreclosure charge of 4.5% of the principal outstanding along with GST and part pre-payment amount is levied as foreclosure charge.
Other charges for foreclosure of a personal loan: Depending upon the type of foreclosure made on personal loans, these charges are levied. These charges can be categorized as:
Part payment charges: Part payment is allowed only once each year and the minimum gap between two part payments should be six months. A maximum of 25% of the principal outstanding is allowed in a single year, part payment charges of 2.5% along with applicable taxes are levied for such repayment. Part payment, however, is not allowed during the lock-in period.
Foreclosure charges for personal loans in the case of top-up: If a borrower has taken a top-up loan, which is over and above the existing personal loan, a foreclosure charge will be levied. This charge is levied only if the new interest rate is lower vis-a-vis the old one. These charges include an amount of 2.5% on the principal outstanding along with GST. Any foreclosure or pre-payment made during the lock-in period will attract foreclosure charges of 4.5% along with applicable taxes on the principal outstanding amount.
Foreclosure charges for personal loans in CCOD cases: If one has taken a personal loan as Cash Credit or Overdraft (CCOD), the lending company levies this charge. The amount levied is 4.5% on the dropped down limit along with GST. If a borrower makes any foreclosure during the lock-in period, an additional 2% above the foreclosure charges along with applicable taxes on the dropped down limit is levied.
Conclusion:
While taking a personal loan for urgent cash requirements, a borrower should always zero in on a trusted lending institution. Lenders offer personal loan that are equipped with attractive personal loan interest rates, hassle-free disbursal, quick online application, minimal documentation and flexible repayment tenures. One can instantly calculate the EMIs using the online personal loan EMI calculator. A borrower can also select from multiple EMI options, like standard EMI, flexi interest-only EMI and step-up flexi loan EMI.
