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What is Personal Loan & Types of Personal
Loan
What is
Personal
Loan • A personal loan is a smaller loan than a mortgage and is generally used to finance a
car or other vehicle, renovations to a home, consolidation of debt, to finance a
vacation of one kind or another, and a great number of other things.
• This type of loan program is available for both salaried and self-employed individuals.
• Personal loans are offered anywhere between the range of 1 lacs to 15 lacs
depending upon your requirement and fulfilment of eligibility criteria.
Types of
Personal
Loans
Secured Personal Loans
Secured personal loans are loans which are allotted against a collateral security
These schemes are better suited for you if you want to take a bigger loan amount and a longer repayment schedule
Hence, this kind of loan program gives you quick and sufficient monetary assistance in regard with your needs
The interest rates are also on the lower side as compared to the unsecured variant
Another nice thing about this type of loan is that you can get a quick and easy sanction owing to the fact that you have already placed a collateral security
Banks are more assured of their investment while sanctioning a secured loan application
Types of
Personal
Loans
Unsecured Personal Loans
Unsecured personal loan program is the opposite of the secured one on almost all counts
In this type of program, you are not required to pledge anything as a collateral though a high credit score is desirable
Unsecured personal loans are ideal for those who can’t place a guarantee against their loan claim
Since there is no security involved, this scheme is generally lent out for a shorter repayment tenure and with a slightly higher interest rate
However, you can get your application sanctioned just as quickly as the secured type once you fulfil the necessary criteria.
Summary
(C) Axis Bank Ltd.
Personal loans are one of the easiest forms of finance that are available today.
The advantage of personal loan lies in solving unsorted personal expenses. Just make sure you are familiar with your needs and budgetary limitations before availing such a loan.
Learn more about personal loans and its various types at It’s All About Money.
