Types Of Personal Loans | Find Personal Loans To Suit Every Situation

Different Types Of Personal Loans

Looking For A Personal Loan? Here Is A List Of Personal Loan Products To Meet Every Need

Personal Loans are a great financial aid when one has some difficult personal need to take care of. These are largely unsecured loans that come with an average repayment tenure of 5 years. Due to their unsecured nature, the interest is slightly higher than other loans like home loans or car loans. However, personal loans are one of the easiest to avail. 

Personal Loans Are Majorly Of Two Types – Unsecured Personal Loans & Secured Personal Loans

Unsecured Personal Loans don’t need any collateral or security. So they usually come with higher interest rates and seek stringent eligibility criteria. A high credit score of 700 & above is a must for getting unsecured personal loans. 

A Secured Personal Loan is issued against collateral, mostly bank FDs that you hold with the same bank. Since these have a collateral backing, you can get a lower interest rate but the loan amount shall be limited to the guarantee amount. 

Other Types Of Personal Loans One Can Get In India

1. Personal Loan Against Credit Card

If you have a credit card, you may be able to obtain an unsecured personal loan known as a Loan Against Credit Card. This loan is determined by your credit limit as well as your credit card usage history. In an emergency, this loan provides immediate access to cash with no paperwork required.

The loan on your credit card will be based on the card’s current credit limit. A few institutions will even go over and beyond your credit limit. A credit card loan’s annual interest rate typically ranges between 12-29%.

2. Wedding Loan

Weddings are a major expenditure in one’s life but you don’t want to compromise on this big day for want of funds. Wedding loans can cover all your wedding expenses like venue, food, photography, clothes & jewelry, and more. 

3. Vacation Loans

More and more Indians are seeking this loan to spend their vacations in some of the best exotic locations around the world. A Vacation Loan covers ticket costs, accommodation, local transport, adventure activities and even travel insurance. 

4. Home Renovation Loans

Is your kitchen in desperate need of an upgrade? Do your walls need a little sprucing up? Do you want to redo your living room? A Home Improvement Loan can assist you with this. This loan covers home renovation and repair charges such as kitchen remodeling, new furniture buys, interior design services, paint, replacing electrical wiring, purchasing new fixtures and fittings, and more.

5. Medical Loans

A medical emergency shouldn’t befall anyone. But many times it does and one can be in need of huge funds to save their loved ones. A Medical Emergency Loan can help you in such times. These loans can take care of surgery costs, medical bills, follow up treatments and checkups. 

6. Higher Education Loan

A borrower can receive a Higher Education Loan to pay for the higher education of a family member or themselves. This loan assists you in paying for your admission fee, tuition charge, book purchase, accommodation, and other educational expenses.

7. PayDay Loans

A Payday Loan is an ultra-short, flexible amount, but very high interest loan that is linked to your upcoming salary. They are pretty popular these days owing to their quick disbursal and completely online application process. Most PayDay Loan providers offer their services through smartphone apps or online websites. The process is quite transparent and borrowers can avail anywhere from Rs.5000 to Rs.5 lakhs. 

8. Instant Personal Loans

Instant Loans are personal loans offered on a short to medium term to meet immediate liquidity needs. These loans are primarily available for salaried individuals. These loans can be used for any end use like medical emergency, wedding expenses, vacation plans, pursuing an education course, etc., 

9. Loan For Pensioners

Pension Loans are personal loans that are only available to retired personnel. The standard eligibility criteria do not apply to this loan program. Some banks may provide 7 to 10 times the amount of pension pensioners drew the month prior to filing their loan application for a pension loan. These loans have a longer repayment period and a smaller loan amount. 

10. Personal Loan For Covid

The Corona pandemic has toppled the lives of millions of individuals around the world, destroying jobs and businesses. During these tough times, banks and NBFCs have launched personal loans for individuals affected by this Covid. To alleviate your burden during the tough moments of the pandemic, this personal loan is typically offered at low interest rates and with no or minimal processing fees. This loan assists you in managing COVID-19-related medical bills and preparing for future issues.

In times of crisis, Indians typically rely on basic credit choices such as credit cards or personal loans. Personal loans account for a sizable percentage of the lending sector. Personal loans provide the ease of immediate disbursement, putting liquid cash in your hands in times of need. Personal loans are unsecured and can be obtained even if your credit score is below average. With the proliferation of rapid loan apps on the market, more and more people are able to accomplish their ambitions.