Monday, January 11, 2016

What is Personal Loan And Process?

A personal loan is a type of debt which is made for personal, family, or household use, and which is neither a business loan nor a long-term mortgage loan.
•Secured Loan
•Unsecured Loan

Range: $100 – $100000


Sources of loans

  • Commercial banks
  • Savings institutions
  • Finance companies
  • Credit unions
  • Some automobile manufacturers
  • Friends
  • Family members


Personal Loan Process
Documentation
Loan Contract
Loan Repayment Schedule
Maturity
Collateral



Documents required - Self Employed
2 photos + ID proof
PAN mandatory
Residential proof
Ownership
Utility bill
1 year banking
3 years ITR + Business proof (tin/service tax, company profile)


Documents required - Salaried
2 photos
ID proof
PAN mandatory
Residential proof
Ownership
Utility bill
6 months banking
3 month salary slip or 2 years form- 16


Loan Contract
A contract that specifies the terms of a loan, as agreed to by the borrower and the lender”


Know Your Customer (KYC)
Amount of the loan
Interest rate
Tenure


Loan Repayment Schedule
Amount
EMI – Estimated Monthly Installment/Equated Monthly Installment
EMI = (P * R/12) * [ (1+R/12)^N] / [ (1+R/12)^N-1],
Where;
P = Principal (loan amount);
R = Annual Interest Rate;
N = No. of Monthly Instalments

Number of Installments
Interest: Rate and Type





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