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How to Get a 10 Lakh Personal Loan

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A personal loan allows you to easily access a high quantum of funds without pledging any collateral and meet any expenses hassle-free. This means that, be it your wedding expenses or paying off your debts of credit cards, you can apply for a personal loan and meet the financial requirements.

So, if you are eager to avail a personal loan, say of an amount of Rs. 10 lakh or above, then you must know the process to get it. You also need the details about how much you need to pay on EMI for a personal loan of Rs. 10 lakh.

Eligibility Criteria to Qualify for Rs. 10 Lakh Personal Loan

Whether you apply for a personal loan of Rs. 20 lakhor Rs. 10 lakh, you must fulfil certain eligibility criteria to avail the funds.

However, note that eligibility parameters may differ with each financial institution. Therefore, for your convenience, the list below mentions some common criteria that most lenders demand from a borrower:

  • Should be an Indian citizen.
  • Must fall between the age group of 21 to 65 years.
  • Should be a salaried employee, be it in the private or public sector or self-employed, with at least 1-year experience in running a business.
  • Minimum monthly earnings should be Rs. 15,000.
  • Should have a CIBIL score of 750 or above.

Steps to Apply for Rs. 10 Lakh Personal Loan

Follow the step-wise guide to avail a personal loan for students of Rs. 10 lakh from a financial institution:

Online Process

Step 1: Visit the website or log in to the mobile application of the bank of your choice. Before selecting a bank, make sure you compare interest rates and EMI for a personal loan of Rs. 10 lakhof different financial institutions to make an informed choice.

Step 2: Now, select ‘Apply for Personal Loan’ and enter the required details in the application form.

Step 3: Submit all the appropriate documents along with the application form.

Step 4: Pay the processing fees or other charges, if any.

After you submit your application, a bank representative will contact you to proceed with the subsequent steps.

Documents to Submit While Applying for Rs. 10 Lakh Personal Loan

Submit the documents mentioned below while applying for a personal loan of Rs. 10 lakh:

  • Identity proof such as Aadhaar card and PAN card
  • Address proof such as electricity bill, passport, and ration card
  • Form 16 or ITR form of the previous fiscal year
  • Last 6 months’ bank account statements
  • If you are a salaried employee, submit your salary slips of the past 3 months.
  • If you are a self-employed applicant, submit either a TDS certificate (Form 16A), Form 26AS, or an Income Tax challan to reveal the income tax of your business.
  • You need to submit ITR returns for the last 2 fiscal years and documents to prove business origination if you are self-employed.

EMI Calculation Process for a Personal Loan of Rs. 10 Lakh

Once you apply for a personal loan app, it is essential to determine the EMI amount to be payable towards your personal loan beforehand. This will assist you in planning and managing your finances effectively and repaying the loan amount without any inconvenience.

Your EMI for a personal loan of Rs. 10 lakhwill depend on the interest rate charged by the lender and the repayment tenure. You can calculate the EMI amount by using the following formula –

P x R x (1+R)^N / [(1+R)^N-1]

Where,

P is the principal amount

R is the interest rate

N is the number of instalments

So suppose you have availed a loan of Rs. 10 lakh for a repayment tenure of 3 years and at an interest rate of 13% (per annum), then the EMI amount will be-

10,00,000x13x(1+13) ^3[1+13) ^3-1] = Rs. 33,694 (per month)

Note that this is an approximate calculation of the EMI amount, and the actual amount may vary.

If you find manual calculation difficult, you can use an online tool like the personal loan EMI calculator offered by leading financial institutions. All you need to do is enter a few basic details such as loan amount, interest rate and tenure to get results in a few minutes.

Thus, follow all the steps mentioned above to get a personal loan of Rs. 10 lakh and meet your monetary obligations easily. Besides, check the EMI for a personal loan of Rs. 10 lakh beforehand to plan your finances accordingly.

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What Are The Key Considerations When Taking a Personal Loan?

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With the rise of digital lending platforms in recent years, getting a loan has never been easier for the average consumer. However, passing Personal Loan eligibility from the abundant choices accessible now might be a daunting task.

It can be difficult, but choosing only one or two lenders is necessary because not all of them may not be reliable. Borrowers must read their loan agreements carefully.

Here are a few things to think about before applying for a Personal Loan:

  1. The Right Credit Score

The approval of a Personal Loan largely depends on your credit score. The creditworthiness of a borrower is represented by a three-digit number between 300 and 900, known as a credit score. It reflects your financial situation in terms of your outstanding debts, borrowing and payback history.

You will move closer to meeting Personal Loan Eligibility criteria when your Experian credit score is higher. The Experian score is a numeric value assigned by the credit beurea Experian, indicating the repayment capacity of an individual. It significantly impacts the loan terms (interest rate and EMI) and the loan amount that can be approved for you. Personal Loans with favorable terms are more likely to be offered to those with Experian scores above 630.

When choosing a Personal Loan provider, it’s important to keep all these things in mind. Your long-term financial well-being can be guaranteed by committing to a loan provider who provides both low-interest rates and a manageable payback schedule.

  1. Examine The Variations In Interest Rates

After a shortlist of loan options has been compiled, further research can be conducted to learn about the various terms and conditions to choose the best course of action. The interest rates offered may vary for all credit products.

You can read the frequently asked questions sections of each product thoroughly so you can compare processing fees and other key factors.

A word of caution for people applying for loans at different NBFCs, narrow down your loan options to just one lender to avoid too many hard inquiries on your credit score. This might affect a person’s Personal Loan eligibility because it signifies the loan provider that the borrower is a credit hungry user.

You can check for promotional deals or programs that can lower the final interest rate. Find out if you qualify for any to get a better interest rate and pay less each month.

  1. Determine The Best Lending Option

Both conventional financial institutions (banks, NBFCs) and innovative companies (Fintech, digital NBFCs) offer Personal Loans to borrowers nowadays. Traditional institutions like banks have stricter documentation requirements and longer processing times. So, they are not ideal when you need quick access to money.

Fintech and NBFCs require little to no paperwork because it is possible to quickly determine a customer’s creditworthiness online. This allows funds from loans to be disbursed quickly.

  1. Loan Repayment Tenure

The sooner a loan is paid back once it is taken out, the better. However, a shorter period for repayment transcends to higher EMIs due to the reduced number of installments.

Failure to repay a loan EMI on time can harm your credit score, making it more difficult to obtain credit in the future. When taking a loan, it is important to understand loan repayments and loan tenure.

  1. Fees Associated With Foreclosure And Prepayment

Foreclosure and prepayment fees are another group of costs that you might find while applying for a Personal Loan. These fees will be incurred if the borrower pays off the loan before the end of the agreed-upon term.

Examining the fees associated with various loan options will help you zero in on the one that gives you the most leeway in terms of making partial or full repayments.

Conclusion:

Beforeapplying for Personal Loan, it’s a good idea to consider the loan provider’s reliability and customer service in light of your financial goals. Clix Capital is among the top new age NBFCs that has been helping Indians achieve financial independence.

There is no limit to options when it comes to applying for a personal loan, but finding the one that’s best for you takes some legwork. It would be best if you weighed the benefits and drawbacks of several loan products before deciding on one and then sign the paperwork for a loan that meets your needs with respect to interest rates, repayment terms, and loan terms.

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10 Dos and Don’ts to Follow While Applying for a Personal Loan

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The personal loan market has been growing steadily over the last few years. A month on month comparison between January 2019 and 2020 shows that in 2020 the personal loan segment witnessed a growth of 16.9% per cent. The number is expected to be higher for the first financial quarter of 2020-21 because of the havoc caused by the Coronavirus.

The Global Lockdown has led to the loss of incomes, and a personal loan is an easy option in these difficult times. Nearly all banks, NBFCs, HFCs and other creditable lending institutions offer this type of credit. While personal loans are readily available, it is essential to keep a few dos and don’ts in mind before filing a loan application.

The Personal Loan Dos and Don’ts

Conducting a thorough Investigation

Many first-time borrowers do a quick Google search for “personal loan apply” and visit the first of two results. Who has the time to search the nearly 700 crore searches that the search engine can produce in less than 100 seconds?

Do – a thorough search requires you to visit the website of at least 3-7 lending institutions. Follow this up with comparing the eligibility, terms and conditions and interest rate.

Don’t –hesitate to get in touch with customer care executives to understand processes and procedures. It will help tick-off the lending institution not suited to your loan requirement.

Understanding your Financial Obligation

Every person has a credit and debit account – earnings vs expenses. An income could be salaries or income from property, shares, etc. Costs would include but not be limited to your daily needs, travel expenses, shopping, insurance premium, educational expenses and EMI or other loans.

Do – create a checklist of necessary and avoidable expenses. Let us assume; you take a personal vehicle for the daily commute. Appropriate expenses will include insurance premium, service costs, petrol, and parking. However, a new car stereo will fall under avoidable expenses.

Don’t – overlook upcoming expenditures such as a planned trip or school admission. It is also necessary to prepare for financial contingencies. It ensures you have sufficient funds to repay EMIs on their due dates.

Calculating the EMI

The most crucial aspect of any retail loan is the equated monthly instalment or EMI. With each EMI, the borrower pays back some part of the principal amount and interest to the lender.

Do – use the free EMI calculator offered by all lending institutions. You can use these easy-to-use tools multiple times. Input loan amount, tenure, and interest rate to get the EMI instantly. Adjust tenure or loan amount to calculate an EMI that you can afford. Read the amortisation table to know the principal amount and interest amount paid with each EMI.

Don’t – forget that you will pay the EMI every month. Missing out on a single EMI leads to a penalty. Take time to understand the penalty clause as well are prepayment charges before you fill the loan application form. It is also recommended to sign up for direct debit / ECS facility so that you don’t miss out on EMI payments.

Partnering with a Trustworthy Lender

Did you know that there are nearly 10,000 NBFCs registered with the Reserve Bank of India? The number of lending institutions increases exponentially when banks and Housing Finance Companies are added to the mix.

Do – get answers to these questions – How long has the NBFC been in operation in India? Is it a stand-alone institution or does a respectable parent company back it? Do customer care executives have clarity in their communication? Do they discuss all applicable costs and charges?

Don’t – forget to read reviews. It is a great way to judge the lending institution’s trustworthiness. With so many choices, searching for the right lending institution can seem like a Herculean task. But reviews, ratings and communication are necessary for informed decision making.

Following Processes and Protocols

We have already mentioned the need to understand the processes and protocols. Once you have finalised the lender, you need to follow each process and protocol. One of the essential protocols is for eligibility and documents.

Do – remember that your credit score is one of the most important criteria to meet. Typically, you require a CIBIL score of 750 for loan approval. Other eligibility criteria include age and income. Personal loan documents required include proof of age, income and residence. In case you are not meeting the requirements, you can explore the option of taking on a co-borrower.

Don’t – file an incomplete or incorrect application. Missing out on the documents required by the lender is an incomplete application. It will lead to rejection which will harm the credit/CIBIL score.

Personal loans are one of the most accessible loans to get in India. Following the above dos and don’ts can undoubtedly help you to choose a lender and loan amount that suits personal requirements. Ensure that you are filling and filing application only when you are 100% sure!

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