During a financial emergency, applying for a short-term Personal Loan is a good option. Many banks and Non-banking Financial Companies (NBFCs) offer loans for borrowers to meet such contingencies and sanction loans at lower interest rates. In this article, let’s discuss what you need to do for getting a short-term emergency Personal Loans.
1. Meet the Loan Requirements
The eligibility criteria for a short-term Personal Loan mainly involves factors such as age, salary, credit score, citizenship, and work experiences.
- Age: The applicant must be between the age of 22 during the application to 58 years till the time of loan maturity
- Citizenship: Indian
- Work Experience: One year with a minimum of two months stability period
- Income: Minimum ₹20,000 monthly income
Banks and NBFCs may have other eligibility criteria as well. However, the listed criteria is most commonly presented before an emergency Personal Loan. Applicants are advised to go through the lender’s specific criteria beforehand.
2. Documents Required for Personal Loans
The document requirement and application are simple and basic to get emergency Personal Loans quickly.
- Aadhaar Card or PAN Card: These documents are required for the purpose of KYC, which the bank or NBFC needs to perform for applicant verification.
- Utility Bills, Rent Agreement, Passport: These serve as proof of the current address of the applicant and its authenticity.
- Salary Slip: Last few months’ salary slips are asked for proof of the monthly salary and employment type.
- Bank Account Statement: Required to check on the applicant’s financial background.
Other primary documents required for a Personal Loan include employment proof and a passport sized photograph; along with a few other basic documents. The eligibility criteria and required documents vary for different banks and NBFCs.
3. Choose a suitable plan and lender
It is essential to study all your options while selecting a bank or NBFC to apply for an emergency Personal Loan. Many lending institutions offer plans and discounts while applying for loans, such as low rates of interest, longer repayment periods, bigger loan amounts, etc. However, these offers are subject to the applicant’s eligibility and factors such as credit score and past loan repayment history.
4. Maintain a Good Credit Score
It is crucial for applicants to have a good credit score with error-free past credit reports. Banks and NBFCs provide a more flexible Personal Loan to people with good credit scores and credit history. Healthy credit scores show the applicant has successfully repaid past or current loans without delays. A minimum credit score is also an eligibility factor for the approval of loans in many lending institutions.
5. Opt for An Online Method of Application
Online applications for short-term loans are quick and hassle-free. The sanction of the loan also takes place within a week of application. Online mode of application saves the extra costs of frequent visits and delays in sanctions. Plus, the documents required for personal loans are uploaded on the portal. Upon the approval of the loan, the amount is directly credited to the bank account.
Features & Benefits of a Short-Term Personal Loan
- No security or collateral is required while applying for a Personal Loan for emergency purposes. Only basic eligibility is enough for approval, provided the documents needed are furnished in time.
- The repayment tenure is more flexible for these Personal Loans, and some lending institutions offer longer repayment tenure, even for a smaller loan amount.
- Many banks and NBFCs offer low rates of interest for short-term Personal Loans. However, it may be dependent on the applicant’s credit score.
- The approvals for short-term Personal Loans are quick and hassle-free, requiring minimal documentation and formalities.
- Short-term Personal Loans are approved for multiple purposes, such as
- Hosting a wedding
- Medical emergency
- Travel requirements
- Home renovation or rent payment needs, and many more
Opting for short-term Personal Loans at banks and NBFCs is advisable as the lending organisations are regulated and follow the legally acceptable method of loan sanctions. Thoroughly research the available lenders before choosing the one that suits your needs the best. This will help you get the best short-term loan for your financial needs.