Personal Loan

Personal Loan

What is a Personal Loan?

Personal Loan is an unsecured loan for salaried and self-employed wherein no security is required against the loan. Unsecured Personal Loan can be taken to finance any short-term requirement like overseas trips, marriage, medical emergencies, etc. The only condition is that the Personal Loan should not be used for speculative purposes.

… We Understand Your Urgency…

Personal Loan is a simple and quick process of funding your financial requirement with minimum documentation and a hassle-free product in banking to get funds. In India, Banks as well as Non-Banking Financial Corporation (NBFC) finance Personal Loan.

Perpose of a personal loan

The product itself justifies the meaning - any of your personal needs which includes…

Personal Loan

Marriage in The Family

Dream Vacation

Dream Vacation

Festival Expenses

Festival Expenses

Medical Emergencies

Medical Emergencies

Furnishing or Renovation of House

Furnishing or Renovation of House

Purchase of High End Consumer Goods

Purchase of High End Consumer Goods

Purchasing of High End Lifestyle Products

Purchasing of High End Lifestyle Products

Overseas Trips

Overseas Trips

Loan Service Providers associated with 3M

Some of the renowned and big players in the Personal Loan segment are HDFC Bank, Citibank, Standard Chartered Bank, ICICI, Kotak Mahindra, Fullerton India, Bajaj Finserv, etc.Always remember that Personal Loan should be taken only in case of Extreme Urgency of Funds.

Key Factors

Loan Eligibility

Since it is unsecured in nature, lenders have stricter norms regarding eligibility and sanctioning of Personal Loan. But some of the basic eligibility criteria the applicant must fulfill are:

  • Indian Resident
  • Minimum 21 years of age
  • Salaried or Self Employed Professional / Non-Professional
  • Permanent employee of the organization, if salaried
  • Continuous source of income to service the loan
Rate of Interest and Loan Amount

The Factor depend on rate of interest and the eligibility are:

  • Current rate of interest is @ 10.45%.
  • Company for which the prospective borrower is working
  • Credit history of the borrower
Fees and Charges

As far as processing fee is concerned, it varies from bank to bank, loan amount or the special schemes operated by respective lending institutions. It will be in the range of 0.25% to 2% + Service tax. However, the best part of Personal Loan is processing fee is not charged upfront, it gets deducted from the loan amount. So here we get good option to compare the loan schemes with various banks and pay processing fee to the bank we zeroed in.

Foreclosure Charges also vary from lender to lender. In few institutions, it is NIL after a certain period of time which is known as Lock-in period or the charges get reduced after 1 year or 2 years.

Documents check-list

KYC Documents
  • Proof of Identity – PAN / Passport / Driver’s License / Voter ID Card / Aadhaar Card etc.
  • Proof of Address – Passport / Aadhaar Card / Landline Telephone Bill / Electricity Bill, Ration Card etc.
    If rented, Rent agreement along with the owner’s light bill
  • Latest 3 months pay slips
  • 2 years form16 or 2 years job continuity proof
A/c. Statement
  • Statement of bank account for the last six months’ salary credits
  • If any previous loan, then Loan A/c. Statement for last 1 year with sanction letter
  • Income documents for Self Employed
  • IT Returns – last 2 / 3 years
  • Audited Balance Sheet & Profit & Loss A/c. – last 3 years
  • Proof of Turnover vide latest Sales / Service Tax Returns
  • Proof of Continuity of Business (Trade License / Establishment / Sales Tax certificate)
  • Office Address Proof
  • Qualification or Registration Proof required for Self-employed Professionals

Things to Consider

3M Loans has the expertise in Personal Loan and we have been associated with various lenders in the market over a decade. Our well-versed team will guide you to the best option and with the help of our tools and calculators, you can fetch up the best deal in the market.We understand your need and the reason for taking a personal loan. In our language it’s a loan of urgency many a times.

Compare before availing for loan

One of the basic mistake people make while applying for a personal loan is not comparing the deal with other lenders. Nowadays, banks or lenders have their own USPs about the features and the policies of products. You need to decide what you want. For e.g. one lender offers a low rate with low processing fee but does not have feature of part payment or have charges on foreclosure. Another lender offers you no foreclosure charges and allows you to do part payment and have slightly higher rate.

Here, 3M Loans gives you the wide range of selection and comparison tool for the deal so that you can decide on what you want – high rate of interest or better features with good rate of interest.

Confirm the T&C before Login

This is a common loan application mistake of not clarifying the loan purpose, that, how the loan amount is going to be used and after how long the purpose will get resolved. When you apply for the loan, please explain the purpose and get all the terms and conditions cleared, so that you can plan your loan amount smartly and plan your repayment as well.

Maintain your CIBIL

Whenever you apply for a loan, banks or lenders check your Credit History that how well you are in managing your income and EMIs. If you have good track records of your loan, it means that you have good Credit History and eventually you have good CIBIL score. And one thing is sure, if you have good CIBIL score, the lender would be eager to make you their customer. Good CIBIL score range from 730 and above.

Check the Approval Agreement

While applying for a loan please make sure you know the terms and conditions of the loan and get all the details before signing the documents. Incase if you have forgotten to check the same while signing the application form, please check the approval agreement given by lender stating the same terms and conditions which you had been told initially.

Signing Blank Documents

Please avoid signing blank agreement or forms. This will help you in two ways:

  • You know what all information is required from you
  • The information is true or not given to you

Thus, you will come to know about the process. Save yourself from any future mishaps and involve yourself in the entire process.

Don’t Hide your Loans

It would be beneficial and help the lender if you give the full details of your income and obligations so that your actual eligibility can be calculated. Concealing such information from the lender would make the task difficult for you to get the loan. Misleading documents or information will lead to rejection of your application.

Which bank is better for Personal Loan?

There are so many lending institutions in the market with so many lucrative schemes, it can be a confusion for the customer to choose the lender.

Apply with us and get benefited

Points to remember while choosing the lender:


Am I Eligible for Personal Loan?

You are just required to have a fixed or regular income to get Personal Loan whether you are a salaried individual, self-employed business person or professional. Eligibility is affected by the company you are employed in, your credit history and your residence's location.

How Loan Amount or EMI is decided?

For the amount of Personal Loan, in case of salaried people, bank / financial institution takes care that DBR (Debt Burden Ratio) is not more than 50% of your Take Home Salary. Here, the existing EMIs are also being considered. For the self-employed, the loan value is determined on the basis of the profit earned.

How My CIBIL Score Matters?

CIBIL Score plays a major role in your loan approval. The Credit Information Bureau of India Limited (CIBIL) is the Central Bank of Data that records your repayment history of Credit Card bills and loans. A good CIBIL score increase the chances of getting loan at good rate with higher eligibility.

Do I have to pay any charge for Personal Loan?

Other than the EMI there are only two charges paid when applied for Personal Loan - one is Processing Fee and other could be Pre-Closure Charges (depends from lender to lender).

Can I take my spouse as co-applicant?
Yes, the spouse or a blood relative can be taken as co-applicant to increase the loan amount or eligibility. This way the income can be clubbed and the loan amount can be increased.
How to repay the loan?
The loan can be repaid in form of Equated Monthly Installment (EMI) via post-dated checks (PDCs) in the name of the bank or through Electronic Clearing Services (ECS).
How to prepay the Personal Loan?

Most of the banks have pre-payment penalty. You might have to pay the pre-closure charges up to 3 - 5%. Few lenders do not charge you after a certain period.

How Reducing Rate and Flat Rate is different?

As the word justifies, Reducing Balance Interest Rate needs the borrower to pay interest only on the remaining principle balance, i.e. the balance that remains outstanding after getting reduced by the principal repayment. Flat Interest Rate is wherein the borrower needs to pay interest on the entire loan balance throughout the loan term. Thus, interest component does not decrease on paid principle. Interest remains flat in all the EMIs.

3M Loans has the expertise in Personal Loan and we have been associated with various lenders in the market over a decade. Our well-versed team will guide you to the best option and with the help of our tools and calculators, you can fetch up the best deal in the market.We understand your need and the reason for taking a personal loan. In our language it’s a loan of urgency many a times.

Points to remember while choosing the lender:

Loan Features

It is essential to check the feature of part payment and the foreclosure charges. Few lenders have both the features in the product. Certain loans such as Home Loan do not attract these charges, but banks do levy them on Personal or Business Loan. Most of the lenders do not allow part payment on Personal Loan.

Make sure about the charges and fees

Read the documents and get clarity from the lender as to about how much will you be charged and for what purpose. We suggest you please read the section of fees and charges carefully and if u have been told for any other discounts, take a written confirmation on email. Please avoid verbal schemes or deal discount and save your time.

Private Banks or Public Banks

Private Banks have huge network of branches and executives who provide round the clock services to your door-step, wherein for Public Banks, due to lack of network, you have to do all the legwork. As far as approval time is concerned, Private Banks are faster and competitive in their rates than Public Banks. Private Banks are fully digitized to reach out to maximum people.

Always remember that Personal Loan should be taken only in case of
Extreme Urgency of Funds.

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