We take a look at 25 banks that currently offer the lowest interest rates on personal loans of Rs 5 lakh for a term of five years, and indicative IMEs that you will have to pay.
Personal loans are like our best friend when we need funds to meet an urgent need or handle an emergency at home. They are one of the easiest loans to get when you don’t have any collateral to offer. This is an unsecured loan where lenders check your income and your credit score to sanction the funds. You can get a personal loan for any immediate need such as marriage, home renovation, medical emergency, education, etc.
One of the most interesting features of a personal loan is its disbursement time. Obtaining a personal loan can take hours for pre-approved clients to a few days for others depending on your profile. Many banks and other lenders promise to disburse personal loans within the week. So, if your credit score is healthy and you also meet the eligibility criteria, then getting a personal loan becomes hassle-free.
Additionally, it is a good idea to compare the interest rates for personal loans which can vary from lender to lender. A personal loan is available at a higher rate of interest. Therefore, it is advisable to compare lenders and calculate their interest rates as well as processing time and other hidden facilities and fees before committing to a legal agreement, according to Bankbazaar.com.
Often, salaried people are preferred by financial institutions to sanction personal loans, but others with clean credit histories can also benefit. All you need to do is complete a loan application and submit all relevant documents verifying your personal, business and income information.
You should also do your due diligence on your financial stability and how you are going to handle monthly repayments. Remember that interest rates are going to be higher, so late payments or defaults can take a toll on your credit score. Timely payments are essential to avoid being listed as delinquent.
Employees can qualify for personal loans by submitting 3-month payslips, Form 16, and previous year’s income tax returns, while self-employed people must submit audited financial statements along with the ITRs for the past two years. .
For self-employed workers, their business must have been in business for at least two years. Professionals such as doctors, CAs, etc. must also be licensed to be eligible for personal loans.
To avoid financial stress, it is good to take out a personal loan that you can comfortably serve and repay through EMIs. It really doesn’t make sense to take out a larger personal loan and increase your risk of late payments and default.
Nowadays, a personal loan EMI calculator is available online. You can calculate the Equivalent Monthly Payment (EMI) by submitting details such as amount, interest rates and length of occupancy.
Here are 25 banks that currently offer the lowest interest rates on personal loans of Rs 5 lakh for a term of five years and indicative IMEs that you will have to pay. Keep in mind that the interest rates that apply to you may be higher depending on the amount of your loan, the length of your loan, your credit rating, etc.
Interest rate and fees on the personal loan of Rs 5 Lakh
Compiled by BankBazaar.com
Note: interest rate on personal loans for all listed public and private banks (ESB) taken into account for data compilation; Banks whose data is not available on their website are not taken into account. Data collected on the respective bank’s website as of December 28, 2021. Banks are listed in ascending order based on interest rate, that is, the bank offering the lowest interest rate on personal loans is placed at the top and the highest at the bottom. The EMI is calculated on the basis of the interest rate mentioned in the table for the Rs 5 Lac loan with a term of 5 years (the processing and other fees are assumed to be zero for the calculation of the EMI); The interest and charges mentioned in the table are indicative and may vary according to the general conditions of the bank. * Rack interest rate; ** APR min from July 21 to September 21; * ^ for seniors â
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