In case you are getting married, facing huge medical bills or trying to repay your outstanding debts, you may think of applying for a personal loan from a number of financial institutions available in the market. When you get a personal loan, you will get a huge amount, and then spend a set amount of years paying it back with interest. The time frame for repayment of your existing personal loan is five years. Basically, Personal Loans are unsecured personal loans available for both salaried and self-employed borrowers to meet their personal and financial requirement that needs immediate cash. These loans are unsecured, hence do not require any kind of collateral or a security. The amount you can borrow is typically between 50,000 and 50,00000, however, the loan amount depends upon your eligibility criteria and the quality of your CIBIL score. Getting a personal loan is very easy nowadays due to the presence of a variety of lenders. Before opting for a personal loan make sure to compare them online to ensure that you get the best terms and interest rates.
There are a variety of alternatives available to get a personal loan apart from the financial institution. You may get a personal loan from a bank, credit union, peer-to-peer lending (P2P) platform, non-banking financial institutions (NBFCs) etc.
Let us discuss how can we apply for a personal loan with each one of them:
Getting a personal loan from a bank
Getting a personal loan from a bank is likely the first method that pops into your head to meet urgent cash requirement. Usually, lenders check your credit score before giving you a personal loan which has its own pros and cons that checks your ability to repay back the loan in a desired amount of time.
Getting a personal loan from a credit union
Credit unions are now more widely accessible than they used to be earlier.
A credit union is a non-profit organization, that offers financial services at a much lower interest rate and fees as compared to large financial institutions, potentially making their personal loans more affordable than those of large, national banks that will allow you to save some amount to meet your urgent needs.
Getting a personal loan from a peer-to-peer lending platform
A peer-to-peer lending platform is treated as a great platform, to get personal loans
even better than NBFCs or large banks. This concept is one of the easiest ways to secure a borrower-friendly Personal loan online in no time. Always opt for this alternative when you want to avoid high-interest rates on your personal loan. This is more convenient as it involves no financial institution as an intermediary in between the process of getting a loan, as you are getting the amount in the form of loan directly from the individuals willing to lend you, not from banks.
Getting a loan from NBFCs
You may also consider getting a personal loan from non-banking financial institutions (NBFCs) apart from financial lenders. There are plenty of NBFCs available in the market that aim to cater to borrowers and edge out banks in terms of speed of access and rate of interest. Just like banks do, they also rely on certain factors such as credit scores and their previous banking history to assess potential loan borrowers.
Their interest rates are also high compared to other banks.
Apart from banks or financial institutions, there are plenty of alternatives available for a borrower to get a personal loan. Choosing an alternative depends upon your will and loan requirement. Make sure to compare them only before choosing the best option for yourself that meets your requirement.