The Indian Banking Sector has grown leaps and bounds with almost 50 different nationalized banks operating within India, both in the public and private sectors. And let's not forget the hundreds of co-operative bank and regional banks which work across the country. Individuals, whether salaried, self-employed professionals, or entrepreneurs, can obtain a wide array of loans to fulfill their financial requirements or purchasing an asset.
Some of the most popular loans offered by almost every bank are:
Personal Loans
Personal loans are unsecured loans provided by banks, which can be used for nearly anything except investing in shares. The borrower is required to provide necessary KYC documents along with proof of income. Generally, borrowers need to have a good CIBIL score to avail a personal loan, and most banks inform the applicants about the approval or denial of their applications in a matter of 2-4 working days.
Being an unsecured loan, personal loans levy a high rate of interest, which can vary between 14 percent to 21 percent depending upon the risk profile of the applicant.
Home Loans
Home loans are one of the most popular forms of loans, and almost every 8 out of 10 residential property transactions involve a home loan. Home loans are long term loans and can be taken for a period of up to 30 years at an attractive rate of interest, which starts at 8.35 percent.
Home loans can be taken to purchase a new residential property, an investment property, a second home, buying land property, construction of a new house, purchasing under-construction properties, finance home extensions, and renovations, etc.
Car and Two-Wheeler Loans
As the name suggests, car and two-wheeler loans are used for purchasing a motor-vehicles. Like every loan, the borrow is required to submit mandatory KYC documents and proof of income. It is also vital for the borrower to have a good CIBIL score to avail of a car and two-wheeler loan at attractive rates of interest. Most car and two-wheeler dealerships have existing tie-ups with commercial banks with make application and disbursement of the car and two-wheeler loan a seamless process.
Car and two-wheeler loans are secured loans, and in the event of default of loan installments, the bank has the freedom to repossess the motor vehicle or two-wheeler hypothecated against the loan.
Education Loans
Education loans are offered to students to pursue higher education in reputed universities in India and abroad. Education loans can cover various expenses such as college or university fees, cost of travel to the location of the university, living expenses for the duration of the course, etc.
Borrowers are required to submit documents such as prior educational credentials, letters of invitation from the university, and other KYC documents. At times, the parents of the borrowers might need to provide a personal guarantee, which states that the parents will repay the loan in an event the borrower defaults on the loan repayments.
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