What Is a Personal Loan - Everything You Need to Know

These days, most aspiring borrowers look to apply for Personal Loans to cover their big-ticket expenses. One major reason for the growing popularity of Personal Loans is that these are unsecured loans that do not require any asset as collateral, and their application and processing time is quick, as is the case here at Hero Fincorp. We offer seamless online Personal Loans in minutes based on minimal monthly salary requirements, with no end-use restrictions on how you use your money. 

If you’re still asking, “What are Personal Loans?” - Here's everything you need to know.
 

What is a Personal Loan? Meaning  & Definition

Personal Loans are collateral-free funding options that financial institutions sanction based on an applicant’s credit history and repayment capacity. Also known as consumer loans, they are multi-purpose loans that one can borrow to meet immediate needs. Whether an individual needs funds for a wedding, holiday, home renovation, education, or medical emergency, a Personal Loan can be a reliable financing instrument to source immediate funds.

What are the Uses of Personal Loans?

Hero Fincorp’s Personal Loans are multi-purpose loans, they require no fixed purpose to be stated for application. Rather, aspiring borrowers can use them for almost any requirement. Some possible uses of Personal Loans are:

• Travel expenses, including visa fees, airfare, hotel accommodation, sightseeing, shopping, adventure activities, etc.
• Wedding expenses, including venue, decorations, catering, photography, wedding outfits,  gifts, invites, etc., a wedding loan can help cover all these expenses.
• Home Renovation expenses, including interior decoration, urgent home repairs, kitchen remodeling, bathroom renovation, tile or roof replacement, landscaping, etc.
• Medical expenses, including surgery, therapy, IVF, cosmetic or dental procedure, medicines, medical equipment, rehabilitation, after-care, etc.
• Education expenses, including admission and tuition fees, lodging, study material, educational equipment, visa fees, etc.

Owing to their no-end-use restrictions, our Personal Loans are one of the most preferred funding options available to people: for both immediate or planned requirements. Moreover, our Personal Loan interest rates are reasonable, and enable our partners to pay off their loans conveniently in easy, affordable EMIs. 

Benefits of Taking a Personal Loan

Borrowers get more than just easy access to Personal Loans, meaning they also get a slew of additional benefits. Here are a few of them.

No Collateral or Security Requirement

Our Personal Loans are unsecured, they do not require any asset as collateral. We offer them based on the applicant's repayment capacity and credit history. 

Minimal Documentation Needs

A lot of people avoid applying for Personal Loans due to their lengthy documentation requirements. However, here at Hero Fincorp, we approve Personal Loans with minimal documents, completely online for each borrower’s convenience. 

Quick Disbursal

If your application is well documented and you meet our easy eligibility criteria: it’ll take just a few minutes for your loan application’s approval, and disbursal. If the 

Competitive Interest Rate

The Personal Loan interest rates at Hero Fincorp are among the most competitive and remain constant throughout the loan tenure. This allows borrowers to plan their EMIs well in advance.

Flexible Loan Tenure

Personal loans offer flexible loan terms and give borrowers the flexibility to choose an EMI plan according to their repayment capacity. Hero Fincorp offers Maximum and Minimum Tenure for Personal Loans of 6 months to 36 months, You can use our online Personal Loan EMI calculator to pick the right tenure choice with budget-friendly EMIs.

No End-Use Restrictions

Unlike other loans, Personal Loans at Hero Fincorp have no end-use restrictions, and borrowers can use the money to meet almost any urgent expense or fulfil any long-standing aspiration in life.

Eligibility Criteria For Personal Loans

Since our Personal Loans are collateral-free, they are somewhat of a calculated risk for us. That is why we must also do our own due diligence before approving loans. Amongst the factors we consider, an applicant’s financial stability is most important. Personal Loan eligibility also depends on monthly income, financial obligations, credit history, and some other things. 

Our eligibility conditions include age profiles and income requirements. The applicants must be 21 to 58 years of age to qualify for a Personal Loan from us. Moreover, salaried employees and self-employed professionals must earn at least ₹ 15,000 per month to get approval. 

Let’s look at Hero FinCorp’s eligibility for personal loans in summary:
  

Documents Required for Personal Loans

Here is the list of documents needed to present when availing of a personal loan from Hero Fincorp:
 

Understanding Personal Loan Interest Rates

The Personal Loan interest rates vary between loan offers, depending on the applicant's income, credit history, current financial obligations, repayment term selected, etc. Along with the interest rates, the applicant must also keep in mind other additional charges, including processing fees, documentation charges, etc. Each loan EMI comprises the Personal Loan principal amount and the interest rate. Borrowers can use our free Personal Loan EMI calculator to choose an ideal repayment tenure, and determine the most affordable EMIs to pay off their loan.

Maximum Amount an Applicant Can Borrow

The maximum loan amount an individual can borrow from us is Rs 5 Lacs. However, this depends on their income, profession, and eligibility assessment. Generally, loans are sanctioned in such a way that the EMIs do not consume more than 30-40% of the applicant’s monthly income. Besides this, we also consider any financial obligations an applicant is currently servicing. Business owners and self-employed professionals get loan approval based on their profits earned, while salaried professionals get it based on their salary and current financial liabilities.

How to Repay a Personal Loan?

The Personal Loan repayment process takes place in monthly EMI's. Each installment includes part of the principal amount and the interest charged. A lot of lending institutions set standing instructions against the borrower’s bank account and deduct the monthly EMI amount on a fixed date. Additionally, borrowers can repay the borrowed amount before the term ends, known as loan prepayment or foreclosure.

Now that you understand what Personal Loans mean, compare loan offers and apply online to meet any planned or urgent expenses. With the increasing popularity of Personal Loans among consumers, fund a large purchase with a loan and repay it in easy EMIs spread across a conveniently affordable loan term.

Frequently Asked Questions

What is a personal loan processing fee?

A personal loan processing fee is a one-time charge levied by financial institutions to cover the administrative costs of processing your loan application. This fee is typically deducted from the loan amount before disbursement.