Introduction
Definition of a personal loan
Significance of knowing the loan process
Summary of the article
Types of Personal Loans
Secured vs Unsecured personal loans
Fixed-rate vs Variable-rate loans
Debt consolidation loans, emergency loans, home improvement loans, etc.
Why People Have Personal Loans
Debt consolidation
Health expenses
Home improvement
Education
Bulk buying or weddings
Eligibility Criteria
Age
Employment status
Income level
Credit rating
Current liabilities
Pre-Application Considerations
Estimating your financial needs
Credit score check
Budgeting for EMIs
Researching lenders
Steps in the Bank Personal Loan Process
Step 1: Shop and compare loan offers
Step 2: Confirm Eligibility
Step 3: Gather required documents
Step 4: Send in the application.
Step 5: Review and verification of application
Step 6: Loan approval
Step 7: Signing the loan agreement
Step 8: Release of funds
Step 9: Tracking EMI and repayment
Documents Needed
Identity authentication
Address proof
Income verification
Employment figures
Bank statements
Factors That Determine Loan Approval
Credit history
Debt-to-income ratio
Loan amount and term
Employer reputation
General Problems and How to Tackle Them
Rejection for having a poor credit score
Poor documentation
High-interest rates
Long waiting time
Online vs Offline Application Process
Advantages and limitations of using each method
e-signatures and Digital KYC
How Banks Evaluate Creditworthiness
Role of credit bureau (such as CIBIL, Experian)
Internal risk models
Loan underwriting process
Understanding Interest Rates and Charges
Flat vs cutting interest rate
Processing fees
Prepayment/foreclosure charges
Late payment fees
Repayment and EMI Management
Setting up auto-debit
Significance of on-time payments
What to do during times of financial hardship
Effect on Credit Score
Positive vs negative effects
How to maintain your score or enhance it
FAQs
Can I apply with a co-borrower?
Can I prepay my personal loan?
What if I skip an EMI?
Conclusion
Summary of the personal lending process Last-minute advice for a stress-free experience