A personal loan is a great saviour when we are short of money and need the funds urgently, it may be due to an emergency or an unplanned expense. Availing a personal loan is quite convenient as the loan is available online by a lender. The online availability reduces the time consumption and efforts of the borrowers while taking this loan. However, the personal loan doesn’t require a borrower to provide collateral or security against the loan, but to get approved they need a good credit history along with a low credit utilization ratio.
Interest Rate & its impact on your Personal Loan
The key to a hassle-free borrowing tenure is to choose the lender that offers the lowest interest rates on your loan. This is because the interest rate at which a loan is approved determines the cost of your borrowing. Lower the rate lower will the monthly outgo of EMI and vice-versa. So, this makes it important to choose a loan that comes at comparatively lower rates.
So, let’s choose the best interest rate for yourself. Here is a list of personal loan interest rates of different lenders. All you need is to compare the rates and choose the best one for you. Here is a list of interest rates for personal loans by the top banks.
- HDFC Bank – 10.75%
- State Bank of India – 9.60 %
- ICICI Bank – 11.25 %
- AXIS Bank – 12%
- IDBI – 8.90%
- BOI (Bank of India) – 10.90%
- Indian Bank – 8.90
- IndusInd – 11%
- Yes Bank -13%
- PNB – 12%
- Bank of Baroda – 12.25%
- Indian Bank -8.50%
- IDFC First Bank – 10.75
- IDBI Bank – 8.75%
Where to Apply?
Though we have a lot of options to apply for a personal loan, we need to do a lot of research work to grab the best deal. However, there is a solution to this, in order to minimize your efforts and save time, applying with DSAs can help you. Finance Buddha is one of such DSAs which can help you get the best deals. You will get all the lenders listed there with their interest rates and other details. So, the comparison becomes much easier and you can apply with any of the lenders that suits your requirement. After applying, executives will call and assist one to take the procedure further. And once the applicant meets the eligibility criteria the loan application gets approved, followed by the loan disbursal in no time.
Personal loan interest rates vary from lender to lender. However, the calculation of personal loan is based on two rate types, which are:
Fixed interest rate: As per the fixed interest rate, the rate of interest charged on your personal loan remains constant throughout the loan tenure. Thus, the EMI which you have to pay will remain constant for the entire tenure.
Floating interest rate: As per the floating interest rate, the interest rate charged on the personal loans is variable. The interest rate here is linked to the external benchmarks perceived by the lender. Thus, based on it, the interest rates as per this rate type keeps changing with the market. Hence, the payable EMI may increase or decrease accordingly.
Key Points for Personal Loan
- A personal loan can be availed for several purposes ranging from a medical emergency to a vacation, funding higher education to a wedding, or even for a credit card payment or debt consolidation.
- Eligibility is an important factor that governs your loan approval. This includes the borrower’s age, income, job stability, employer status, CIBIL score, and credit utilization ratio.
- Loan Amount: The loan amount which you can get through a personal loan ranges from ₹ 5,000 to ₹ 25 Lakhs depending on your eligibility.
- Loan Tenure for a personal loan ranges from 12 to 72 months.
- Processing Fees start from 1% and can go up to 2% of the loan amount.
- Documents required include Address Proof, Identity Proof and Income Documents.
Banks may offer customized personal loan interest rates and schemes for salaried borrowers working in government and MNC companies. However, calculating your estimated EMI using an EMI calculator is a must to know your total borrowing cost and to analyse your affordability.