Here’s Everything You Need To Know About Private Loans

Mr. Kumar faces a sudden medical emergency and incurs substantial expenses because of it. While his insurance policy can cover some of the costs, he would require a considerable amount to pay for the rest of the expenses. At such a stage, his best option would be to look for private loans . Lenders are ready to provide hassle-free financing to individuals, such as Mr. Kumar, provided they qualify the eligibility criteria. 

Navi offers low-interest personal loans to both salaried and self-employed individuals. You can check the details of such a loan on the Navi app. However, before applying, go through the following write-up to know more about these loans. 

Features And Benefits of Private Loans

A private finance loan is highly useful in certain instances. Read on to learn more about its various features and advantages. 

• Unsecured credit: Private loans are unsecured in nature, which means you do not need to pledge any collateral against such advances. Instead, lenders offer the amount based on your eligibility factors alone. Since they are unsecured, private loans require minimal documentation, and the processing is much faster too. These features make it the perfect option to fund emergency expenses. 

• Flexible tenure: Depending on your monthly income, you can choose the most-suitable repayment term for such loans. To reduce the monthly outgo, make sure you opt for a long tenure. Keep in mind that the tenure you choose will have a say in your private loan interest rates. A longer tenure can reduce the monthly instalment amount, but the overall cost of borrowing will increase. 

• No end-use restrictions: In the case of some loans, the amount is earmarked for a particular expense only. For example, you can avail a home loan to buy or build a property. However, private loans come with no such compulsions. You can avail such a loan and finance any of your expenses. Commonly, individuals avail personal loans to fund marriages, international vacations, medical expenses, and more.

• Easy and quick disbursals: Today, private loan lenders accept online applications. Therefore, rather than visiting a bank branch, you can avail such advances from the comfort of your home. Such a streamlined application and verification process enables lenders to disburse the required funds in just a matter of minutes. 

If you are looking to avail a personal loan, download the Navi app and initiate the application procedure. 

• Ability to choose your loan amount: Your chosen private loan company may offer a substantial loan amount if you fulfil the eligibility criteria. However, if you do not require that much money, you can always choose to avail a lower amount. For instance, if you have a pre-approved loan of Rs. 15 lakh from your financial institution, you can choose to avail any amount lower than this.

Reasons To Choose Navi As Your Private Loan Provider

Navi is one of the trusted financial lenders operating in India presently. The following are some reasons to seek financial assistance from this company:

• Considerable loan amount: Navi offers private loans of up to Rs. 20 lakh to eligible applicants. You can utilise the amount in whichever way you want; there are no end-use restrictions. 

• Flexible tenure: Choose your preferred repayment term and customise the monthly instalment as per your wish. Doing so allows you to remain stress-free while repaying such loans.

• Quick disbursals: Navi offers a completely online KYC verification process. After you complete the loan application procedure, you will receive the funds in your bank account in a matter of minutes. The entire application and disbursal process hardly takes more than 15 minutes. Moreover, due to a paperless application process, the process is streamlined further.

• Affordable interest rates: Navi offers competitive private loan interest rates. Such a feature reduces financial pressure on borrowers, allowing for easier repayment and minimal risk of default.

• Easy to meet eligibility requirements: Applicants need to meet only a few parameters to become eligible for a private loan at Navi. You can check some of these eligibility criteria below.

Eligibility Criteria And Documents Required For Private Loans

Here are some basic requirements when availing a personal loan at Navi: 

• Credit score – Before applying, make sure that you have a credit score of 750 or more. This indicates that one is a responsible borrower with few or no defaults in the past.
• Age – Salaried employees aged between 18 and 60 years can avail such loans. On the other hand, if you own a business, your age at the time of loan application should be between 21 and 65 years.
• Minimum monthly income – Individuals must also match or exceed the minimum monthly income required to avail private loans. 

Besides fulfilling the eligibility criteria, an applicant should submit the following documents to opt for such loans:

• Identity proof
• Residential address proof
• Proof of income
• IT returns
• Photographs

Keep these documents handy before applying for a personal loan to make the process simpler and ensure faster approvals.

Steps To Apply For A Private Loan

Now that you know everything else about private loans, here is the complete application procedure to help you further:

Step 1: Visit Navi’s website or use the Navi app.

Step 2: Select the personal loan option and choose the loan amount. Make sure you adjust the EMI amount as well to lock in your preferred repayment tenure.

Step 3: Fill up the application form by providing all relevant information.

Step 4: Complete a quick online KYC verification process using your PAN and Aadhaar details. 

Step 5: Submit the application and wait for the approval.

If you complete the process successfully, you will receive the funds shortly. 

Final Words

Navi’s private loans can help you fulfil all types of financial requirements. From enjoying a family trip to offering the best education to your child, this type of credit can ease the affordability of these expensive pursuits. 

That said, before opting for a private loan, make sure you use a personal loan EMI calculator to compute the monthly EMIs beforehand. This will help you manage your finances better. 

Frequently Asked Questions

1. Can I avail a personal loan with a low CIBIL score?

Even though it is not an ideal scenario, your lender may allow you to avail such loans with a low CIBIL rating. The interest charges may be higher than normal since the credit risk is higher.

2. Can I prepay my personal loan?

Prepaying a personal loan is beneficial in certain situations, often allowing you to save on the interest costs. Prepaying refers to paying a part of the outstanding principal before time. However, keep in mind that some lenders charge a fee for such prepayment.

3. What are the disadvantages of a longer loan tenure?

If individuals opt for a longer loan tenure, they have to pay lower EMIs, which makes the loan repayment more manageable. Nevertheless, a longer tenure also leads to an increase in the interest cost of a loan. Therefore, if you intend to keep the overall cost of borrowing low, make sure you avail personal loans for a shorter duration.

4. How can I improve my CIBIL score?

You can practice several methods to improve your CIBIL score. The easiest way to improve this score is to repay your existing dues on time without fail. If you use a credit card, make sure to clear its bill in full after every billing cycle.

5. What is a credit mix, and how can it improve CIBIL score?

Credit mix refers to a balance between secured and unsecured loans in one’s borrowing portfolio. If you opt for too many unsecured loans and not enough secured credit, your credit score suffers. Therefore, your history of borrowing should have a good balance of both kinds of loans.

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