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Personal Finance

What Is The Average Interest Rate On Personal Loan In Festive Season?

The festive season is the most colourful and happiest time in the diaries of Indians. Banks and other financial institutions will never fail to surprise you during the festive seasons. A personal loan taken during a festive season will surely be a life-saver. Also, the personal loan interest rate during festive seasons will be affordable. In this article, you will find the average personal loan interest rate during festive seasons. [B-01] What is a Personal Loan? A personal loan is an amount that you borrow from banks or other Non-Banking Financial Companies (NBFCs). You must pay interest till the repayment period for the principal amount in a personal loan. There is no need for you to provide security or collateral when applying for a personal loan, unlike a mortgage loan. The amount that you get from a personal loan is personal in practice. Because no one can question you on “where you have spent your money?”. This is one of the biggest advantages of a personal loan. What is the average interest rate and benefits on Personal Loans during the festive season? The festive season is the time when most of you will need money. This is to meet your needs like buying clothes, planning events, etc. During the festive season, personal loanswill also surprise you. Because the personal loan interest rate will be lower than at other times of the year. The average personal loan interest rate during festive seasons ranges between 10.00% to 24%. The reason for low-interest rates during festive seasons is the higher demand. The lenders will also give you a higher principal amount during the festive seasons. This will help you in multiple ways. There will be other special offers during the festive season. It may include your repayment period, flexibility in repayment, etc. Some lending institutions will also give special offers on processing charges. It depends on the amount that you avail from them. You will also have quick approval during the festive seasons. You need not worry about delayed sanctions. Note: The average personal loan interest rate will not be constant. It changes as per the lending institution and banks. The offers will also change during the festive seasons What are the factors that affect your eligibility for a personal loan during the festive seasons? Many factors decide your loan interest rate during a festive season. They include your age, credit score, occupation, etc. They are discussed in detail below. Employment status This is the basic factor. If you are an unemployed person, there is no chance. This is because of your inability to repay the interest. You can be a salaried employee or a self-employed individual. Age Your age is necessary for fixing the principal amount. Most of the lenders fix 21 years to 60 years. The age criteria are different for different lenders. The minimum is your age, maximum will be the chance for a personal loan. Experience The years of experience and work in the same industry will be considered. For example, person X has a working experience of 3 years and has changed 3 different fields. But person Y has a work experience of 10 years in the same industry. Without a doubt, the lender will prefer person X to person Y for a personal loan. Credit (CIBIL) score A credit score is important for personal loans and other financial activities. CIBIL Score shows your credit history. This scale ranges from 300 to 900. It is always advised to have a minimum CIBIL score of 700 to avail of a personal loan. If you have a low credit score, don’t worry. You can improve your CIBIL score. So it is better to check your credit (CIBIL) score online before planning for a personal loan. Financial discipline The lenders will also consider past repayment history for a personal loan. This will make your profile low-risk. This includes timely payment of EMIs and interest rates. The reputation of your organisation If you are a salaried employee, your organization’s reputation will also help. If yours is a well-known company, the chances will be high. What are the benefits of a Personal Loan? Minimum Documentation: We’ll ask you only for a few basic documents. This will not only save you time but reduce your burden. They are the proof of your identity, address, and your income. Check the documents required in advance to avoid a last-minute rush. Principal Amount: We provide principal amounts even from Rs.1 Lakh. Quick Sanction: We will sanction the amount as soon as possible, but also disburse funds quickly. Use as you wish: You can use the principal to finance any of your needs. It may be your dream vehicle or your medical emergency. Low EMI: We will never charge high-personal loan interest rates. It will be decided only by your ability and creditworthiness. This will also help in easy cash management. Flexible Repayment Period: To pay your interests, you can choose any method (fixed type, floating type, or hybrid type). You can also pre-close and pre-pay. It ranges from 12 months to 60 months. Zero Pre-payment and Foreclosure charges: Before the period, if you have a bulk amount, you can pay off the loan. We won’t charge extra for pre-closing your loan. [B-02] Conclusion We hope you are clear on why you should take a personal loan during the festive seasons. As festive seasons are on the way, Piramal Finance wishes to light up your lives by lowering your personal loan interest rates. If you wish to take a personal loan at zero pre-payment and foreclosure charges, get in touch with us. We work with a team of experts to assist you in every financial step of your life. To read more about other financial topics, you can visit Piramal Finance whenever you wish. Wishing more diyas glowing in your life!
08-11-2023
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Personal Loan

How Piramal Finance Helps You To Calculate Personal Loan Emi Online In India?

Planning your finances allows you to better manage your monthly budget and set aside some money for emergencies. However, you can never be too prepared financially. A personal loan can be helpful in difficult, unforeseen situations. It does not need any sort of collateral and can be used for whatever purpose the borrower sees fit. However, just because unsecured personal loans are an option doesn’t mean you should rush out and apply for one without first conducting some research. Personal loan EMI calculators may be found on the Piramal Finance website, and they should be used before you hit the “personal loan apply” button. Otherwise, you can end yourself in a position where you can’t afford to make your regular loan payments. Everyone looking for a loan would benefit greatly from using a personal loan interest calculator or a monthly payment calculator. You may estimate your personal loan EMIs in advance, which is useful for budgeting purposes. Let’s take a deeper look at the Piramal Finance Personal loan EMI calculators. [B-01] What is a personal loan EMI calculator? It’s obvious what a personal loan monthly payment calculator does. The overall interest accrued, as well as the total amount owed each month, and the monthly EMI payment, are all calculated for you. Input the amount you wish to borrow, the interest rate you would like to pay, and the length of time over which you would like to pay it back. The Personal loan EMI calculators will show you the monthly payment amount, the total interest paid on the principal, and the total amount owed based on the information you provide. Keep in mind that the Personal loan EMI calculator provided by Piramal Finance is simply a rough estimate and your actual interest rate for a loan will be based on the bank’s evaluation of your financial standing. How can you use the Personal Loan EMI Calculator? Piramal Finance’s personal loan EMI calculator is shown below. First, go to Piramal Finance’s official website Go to Piramal Finance’s webpage for further information. Use the Personal loan EMI calculators by going to the Calculator menu. Enter the loan amount Following this, you will be prompted to input the desired loan amount. Enter the tenure The term of the loan is how long you plan to pay it back. The Personal loan EMI calculators require you to enter the tenure of your loan. Enter the rate of interest The last step is to input the interest rate that is displayed on the Piramal Finance website. Typically, it rises from the 10% range. If you want to know how much you will have to pay each month toward your house loan, you may use a Personal loan EMI calculators to figure out your monthly payments. What affects your personal loan EMI Your EMI will mainly be affected by three variables. Your EMI will increase in proportion to the size of your loan’s principal. The amount of your EMI is closely related to the interest rate on your loan. The interest rate determines the monthly payment amount (EMI). If your loan has a fixed interest rate, your monthly payment won’t change. If the interest rate on your loan fluctuates, you’ll pay a lower monthly payment (EMI) while the rate is low but a larger EMI when the rate is high. Your loan’s EMI will go down as its term length increases. The longer the term of the loan, the less money you’ll have to pay each month. Remember that a longer tenor will result in higher interest rates. Utilizing the EMI calculators provided by Piramal Finance Some benefits of utilizing Personal loan EMI calculators include: Compare Loans Calculators that estimate monthly payments are a great resource for evaluating loan packages. Interest rates for personal loans vary from one financial institution to the next. So, it is helpful to use an EMI calculator to estimate how much money you will owe each month. Using an EMI calculator for a personal loan, you can quickly determine if a certain loan program is a good fit for your budget. Get the proper tenure There are many possibilities for tenure that may be explored with the help of an EMI calculator. EMI decreases as the tenor increases and vice versa, hence a longer tenor yields a lower EMI. If the monthly payment is low enough, you won’t feel overwhelmed by the obligation to repay the loan. Find the entire amount of interest If you need a breakdown of your repayment plan, a personal loan EMI calculator might help. You can see how much of your payment goes toward the principal and how much toward interest. Using an EMI calculator on Piramal Finance’s website provides quick access to all this data. Save time It’s unrealistic to contact the lending departments of many financial institutions every time you have a question. One option is to utilize an online Personal loan EMI calculators, which may provide the necessary information in a matter of seconds. [B-02] Conclusion Personal loan EMI calculators help borrowers make educated borrowing choices. By using the Piramal Finance EMI calculator, you may examine your equivalent monthly instalments, total interest amount, total payback amount, and planned repayments. You may also determine what term length will be most manageable for you to repay your loan. An EMI calculator can help you evaluate personal loan offers from several banks and select the best one. You should always be on time with your loan EMI payments. If your loan EMI is too expensive, there are many options available to you. It is prudent to do some homework before committing to a loan. Choose a lender that provides a competitive interest rate on loans and keep your monthly EMIs within reasonable bounds. Piramal Finance can assist you in preparing a home loan application.
08-11-2023
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Personal Loan

6 Unseen Factors That Can Infect Your Personal Loan Interest Rate

Due to the flexibility of sanctions, personal loans are one of the most useful forms of debt consolidation. You can use a personal loan for practically anything. From paying for a dream vacation to making a down payment on a home. You should check your finances to make sure you can afford a personal loan before applying for one. You may calculate how much you will pay in interest throughout the life of your loan by looking at the rates now available to you. There is a wide range of interest rates for consumers and loan providers to consider when determining the terms of a personal loan. Personal loan interest rates vary from one lender to the next depending on several factors, including your credit score. Your ability to repay a personal loan is enhanced by a high CIBIL score since you will likely qualify for lower interest rates. Lenders take several criteria into account when determining interest rates for unsecured loans. The good news is that some elements influencing personal loan interest rates are within your control, allowing you to increase your reputation. Keep reading to find out what they are. [B-01] Factors that Affect Your Personal Loan Interest Rate Personal loans in India have seen a big upswing and are expected to continue increasing at a rapid pace to keep up with the demands of the ordinary Indian consumer. Weddings, vacations, college tuition, event planning, home improvements, unexpected medical expenses, and so on, all benefit greatly from the availability of personal loans. Personal loans are popular because they may be used for a variety of purposes, the borrower bears no risk, and the loan can be processed quickly and easily online. Although many people are tempted by the convenience of a personal loan, it’s important to consider all of your options before making an application and ensure that your prospects look stable for making full payback of a potential personal loan. Personal loan interest rates are a major factor in determining whether or not you can afford to repay a personal loan. In the cases of house loans and auto loans, personal loan interest rates are more or less set for all borrowers. But these rates might change based on the borrower and the lender’s standards for approval. As a result, it is generally recommended that you learn everything you can about the factors that influence the interest rate on your loan. You may see a change in your personal loan’s interest rate as a result of the following. High-Interest Rates A person’s credit score determines the interest rate that is levied on a personal loan. Personal loans with lower interest rates are more likely to be approved for borrowers with higher credit scores, while those with lower scores may be turned down for financing altogether. You should be wary of the interest rate on a personal loan if you’ve turned to it because you were denied a cheaper financial instrument, such as a credit card with a teaser rate. You may have been having trouble making ends meet and a personal loan might reduce your monthly payments. However, you should still factor in how long it will take to repay the loan and how much it will cost in interest. Fees for Early Payment When a loan is repaid before it matures, the borrower is subject to a prepayment penalty. Lenders may impose these fees in an attempt to recoup some of the money they forewent on interest. The total amount you owe on a personal loan might grow due to prepayment penalties and other costs. You should ask the lender if a loan includes a prepayment penalty. Disclosure is necessary, but it may be in the tiny print of your loan paperwork. Upfront Costs of Getting the Loan Adding to your overall loan expenses are origination fees, which are a percentage of the loan amount that the lender charges for providing the loan. Although most lenders impose this fee, some either don’t or charge significantly higher rates of interest. Up to 15% of the total loan amount is on origination costs. The amount you get might be less than the original loan amount due to origination fees. If you borrow INR 10,000 and the origination cost is 5%, for example, you may only receive INR 9,500 or end up owing INR 10,500. Make sure you have a firm grasp of the mechanics of how it will function. Increased Total Debt It’s wise to look for a low-interest rate when applying for a personal loan to pay off credit card debt, but it shouldn’t be your only priority. Debt consolidation loans aren’t always the best option. But they are useful if you use them in conjunction with other measures. You also need to address the underlying causes of excessive credit card debt. Negative Impact on Your Credit Score While researching the rates and terms, it is wise to also look at the average credit scores of applications. Pick a loan that has a high probability of acceptance. You might not want to apply and risk dropping a few points if you can’t prequalify. Individual negotiation skills A bank’s most valued clientele are those who have been banking with them for many years and have opened permanent accounts. You may negotiate better terms with the bank regarding interest rates, processing fees, etc. if you have a solid rapport with the management and other employees. Banks may agree to lower interest rates or unique offers just for you, based on your negotiating talents. Your loan EMI calculator may reflect the favourable terms you were able to negotiate. [B-02] Conclusion If utilized properly, personal loan interest rates may alleviate the stress of an unexpected financial emergency. Personal loans are now available at the touch of a finger. Thanks to technological advances and the expansion of “one-touch banking.” When applying for a personal loan, though, it’s important to consider all the aforementioned issues thoroughly. Do you still need convincing? It’s time to get in touch with the experts. All your financial worries would be solved with the aid of Piramal Finance.
08-11-2023
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Calculator

Beginner’s Guide To Use PPF Calculator In Current Year-Piramal Finance

A Public Provident Fund is an ideal investment whether you are a responsible parent, a young adult, or a new employee exploring ways to accumulate funds for a safe future. However, it is arduous to calculate the interest and returns on the investment. That is where the PPF calculator comes in as a saviour to make these terrifying calculations easy! But how to use a PPF calculator? This article will walk you through the step-by-step process for using the calculator and provide you with some real insights into how the PPF scheme works. So dive in! [B-01] What is a Public Provident Fund? Public Provident Fund, or PPF, is a lucrative retirement benefits scheme that aims to turn small savings into investments with reasonable interests. The government of India initiated the scheme in 1968 to promote a safe and secure post-retirement life. It is a prime choice for many residents owing to the tax benefits and attractive interest rates it guarantees. The scheme requires a minimum of Rs. 500 deposit, with the maximum being Rs. 1.50 lakhs to retain the account. As a result, PPF is a good option for building a sizable corpus as it comes with long-term benefits. What are the features of the PPF? The PPF account is accessible to any Indian citizen. Here is an overview of some of the features it accompanies: PPF is a stable investment as it is a government-backed scheme. It promises an interest rate of 7.1%, compounded annually. You can make the investments in a maximum of 12 instalments or a lump sum per your suitability. PPF offers a risk-free investment opportunity with high guaranteed returns. You can borrow loans from banks against the PPF account. An amount of Rs. 1.5 lakhs can benefit from the tax exemptions under Section 80C, Income Tax Act, 1961. How does the PPF work? The PPF account provides income tax deduction under Section 80C for the amount you invest. It implies that the interest you accumulate from your investment is subject to tax exemption. Besides interest, there is no tax levied on the maturity also. PPF accounts have a tenure of 15 years. In essence, you will have a lock-in period of 15 years to acquire funds for the future. However, there are two options you can opt for when the investment matures: Closure of Account If you wish to end the investment, you can visit the bank branch or post office where you opened your account. Write an application to withdraw the proceeds and close the account. Mention the bank details to simplify the transfer process and keep your original passbook handy. Additionally, attach your identity proof, address proof, and a cancelled check to the rest of the documentation. You can submit them to the bank or post office officials once you have all the required documents. Continue account for the next 5-years You need to give an intimation in writing on a prescribed form to your bank or post office within a year of maturity if you want to extend the period. You can retain the account operative without making any new contributions. However, you can continue depositing to avail of tax deductions on those deposits. Once you hit the block of five years, you can request another extension of five years, and so on. This way, your account will earn interest until you close it permanently. How is PPF calculated? A PPF calculator presents the future value of your investment based on the current interest rate and the annual contribution you make toward your account. The formula is as follows: M = P [ ( { (1 + i) ^ n} – 1) / i] Where, M = Maturity value P = Annual Payments i = Interest Rate n = Number of Years Let’s take an example to comprehend how it works. Annual ContributionsRs. 1 LakhNumber of Years15 Interest Rate7.1% Using the data given in the table, M = 1,00,000 [ ( { (1+7%) ^ 15} – 1) / 7%] M = Rs. 27,12,139 If there is a change in interest rate, you will have to make the same calculation for different periods. For example, say the rate is 7% for five years, but it elevates to 8% for the next five years. In this case, you can calculate the M with ten years as n and i of 7%. Then add the amount to the M with five years as n and 8% as I. How to use an online PPF calculator? Since the money you deposit in PPF has a lock-in for 15 years, it is preferable to know how it will grow. Manually doing it is undoubtedly one way to estimate the amount, but a minute error can turn your entire calculation wrong. PPF calculator is a digital tool that enables you to calculate returns on the deposits you make in your account. It further facilitates making adequate investment and tax-saving plans. Here is the short and easy process that you need to follow to calculate the expected return on your investment: Type in your annual investment or move the slider to get the amount. Enter the tenure or maturity period in the next column. You do not have to worry about finding the prevailing interest rate, as the calculator sets the current rate on default. Once you have furnished all the required details, the calculator will effortlessly compute the amount and show you the desired information. You can view the total amount you invested in the scheme, the interest you accumulated, and the maturity value you will receive. Things to keep in mind while using an online PPF calculator Some things you must keep in mind when using an online PPF calculator are: The government sets the interest rate quarterly The interest is compounded once yearly The compounded interest is determined annually at the end of each fiscal year The longer the investment duration, the higher interest you will receive on the value [B-02] Conclusion Earlier, it was undeniably challenging to stay updated with the fluctuating interest rates on PPF. But the introduction of PPF calculators came as nothing less than a boon. It is now significantly simpler for several account holders to keep track of the rates and determine their corpus at any time from any location. It also eliminates the errors that may come from manual calculations and saves time. All you need to do is type in the few required details regarding your investment, and you will be good to go! Piramal finance will assist you in making the right financial decision that will help you cultivate the maximum benefits. It is an Indian financial services company aiming to provide and simplify retail lending, including personal loans, business loans, housing loans, and other financial products and services to consumers.
08-11-2023
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Personal Loan

Why Borrowing Money From Other Individuals Is Not a Good Thing Compare To Personal Loan

If you have faced a financial crisis, then you must have faced this dilemma of whether to borrow money from your immediate acquaintances, such as your family members and friends, or opt for a personal loan. Although there is nothing inherently bad in borrowing money from people you know, it has some flip sides too. It might affect your relationship. Hence, it is always recommended to keep monetary affairs and relationships separate. Hence, the wisest thing to do is to apply for a personal loan from an authorised financial institution. To help you understand better why it is wiser to apply for a personal loan instead of borrowing from other individuals, here’s an article that will discuss the reasons in detail. Hence, let’s start right away! [B-01] 6 reasons to opt for a Personal Loan over other individuals Following are the 6 reasons to opt for a Personal Loan instead of borrowing money from other individuals: 1. More borrowing options In times of need, you can secure an instant personal loan from a bank, online lender, credit union, or an instant loan app. Depending on your requirements and eligibility, you can choose any option from the above-mentioned lending platforms. However, when borrowing money from individuals such as your friends or family, you might need to find out who would be willing to lend you money. 2. Personal Loans have clearly stated terms and conditions An unorganised borrowing, i.e., a loan from either family or friends, usually involves a verbal arrangement and isn’t equipped with clear terms and conditions. Although both the involved parties might have the best intentions, it is always possible that with time any one or both involved parties might forget some of the details of the loan agreement. This can lead to confusion and stress. On the other hand, a personal loan is a vividly documented financial transaction between the lender and the borrower. Since it is a written agreement, it leaves no room for confusion about the loan terms and conditions, interest rate, and tenure. Unlike unorganised borrowing, which usually doesn’t have a well-defined and pre-determined repayment schedule, a personal loan, on the other hand, allows you to be well-informed about your loan repayment schedule and the exact amount of EMI that you need to pay regularly. It is a legally binding contract that protects the financial interests of both the lender and the borrower and ensures transactional transparency. 3. Borrowing from acquaintances can put a strain on the relationship Borrowing money from other individuals, such as your friends and family, can be risky. This is because once you borrow money from one of your acquaintances, the monetary matters now involved can put a strain on your relationship. If you fail to return the money on the verbally agreed-upon date, it can damage the relationship. Also, the lender himself might end up in a financially tight spot and ask for the loan amount from you earlier than the agreed-upon date. If you are unable to return it as per the whims of the lender, your relationship with the lender might turn sour. Moreover, when you borrow money from your family or friends, the borrowings are generally interest-free. This means the lender doesn’t get to earn anything from the loan arrangement. While this might sound attractive initially, it might cause trouble later. The lender might later regret lending the money or demand an unreasonable amount as interest. 4. Personal Loans can help you build a credit history Another glaring disadvantage of borrowing money from an individual rather than from a financial institution is that you won’t be able to build your credit history. By taking a personal loan from an authorised money lending institution such as a bank or online lender helps you build a good credit history. A good credit history, in turn, will help you to qualify for better rates on your future loans and lines of credit. 5. A Personal Loan doesn’t come with any obligations The best thing about personal loans is that you can use the loan amount for a wide range of purposes, including making home improvements, consolidating debt/debts, or funding a major purchase. This flexibility qualifies personal loans as a versatile option for borrowers. Moreover, the lender of a personal loan won’t ask you or supervise where you are spending the loan amount. However, if you borrow from individuals such as a friend or family member, you might feel obligated to inform the lender where you will be spending the borrowed fund. This might also elicit some kind of disapproval from the lender, provided the lender finds your cause for borrowing unconvincing. Moreover, borrowing from an acquaintance keeps you indebted to them long after you have repaid the debt amount. You might be reminded now and then about the favour that you owe them, and also, you might be forced to help them whenever they are in need. To avoid such awkwardness and obligations, opting for a personal loan is always better. 6. You can borrow the exact required amount from one lender If you want to borrow a hefty amount, then applying for a personal loan makes more sense. This is because authorised money lending institutions will lend you the exact amount of cash you need. However, there are chances that if you ask for a hefty amount from an individual such as a family member or a friend, they might refuse to part with such a huge sum. Moreover, they might not even have enough cash to lend the amount to you. If that is the case, you might end up borrowing money from more than one individual, further complicating your financial matters. [B-02] Conclusion Now you might ask, “which is the better option?” However, there can be no definite answer to this question because it wholly depends on your situation. That being said, it is always considered wise to consider personal loans’ advantages. Moreover, now you can easily apply for an instant personal loan from Piramal Finance Limited. It is a registered finance company that offers quick, hassle-free and easy personal loans with zero foreclosure and prepayment charges. Their team of expert advisors would help us through the entire loan application process, thus ensuring fast approvals and quick disbursals in your account. They also guarantee minimum documentation and pocket-friendly monthly EMIs. Visit the official website of Piramal Finance now!
08-11-2023
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Personal Loan

How Can You Split the Principal and Interest in an EMI Loan?

Taking out a loan is a big step, and matters like these are very important. One should always be familiar with the terms used, notably EMI, principal, and interest. These factors combine to determine how much it will cost to repay the loan. Adding the principal and interest together gives the total money to be repaid. Read ahead to find out how to split an EMI loan. [B-01] What is EMI? An Equated Monthly Instalment (EMI) is a fixed monthly payment made by a borrower to a lender on a given date. Each month, equal monthly instalments are shared with the interest and the principal so that the loan is paid off in full over a given number of years. Intending to finish the loan, the borrower makes a fixed payment during a set interval of time with the lender. What Exactly is the Principal? The initial amount of money lent to a borrower is called the “principal.” Take out an INR 550,000 mortgage to buy a house, for example, and the principal is INR 550,000. However, that is not the total amount required to be repaid. The lender must include interest to determine the actual cost of borrowing that money. Explain the Term “Interest” In addition to the loan, interest is the percentage charged to the borrower for borrowing money. This is often referred to as the annual percentage rate (APR). The interest is a fee paid to a lender for borrowing money and is usually calculated using an annual percentage rate. You can calculate the APR as a percentage of the loan’s total principal balance. It is important to understand how each EMI is allocated to principal and interest repayments because many important decisions are affected by how the EMI is placed. Use an Excel spreadsheet to calculate the principal amount from an EMI. The PMT function in Excel can be used to calculate the EMI value, which has the following syntax: =PMT(RATE,NPER,PV,FV,TYPE) For example, if you want to find the EMI value for INR 100,000 loan that is payable over 5 years (i.e., 60 monthly instalments) at a 12% p.a. interest rate, enter the following formula into a cell in an Excel spreadsheet: =PMT(0.01,60,100000,0,0); It should be noted that the rate used in the formula should be a monthly rate, such as 12%/12=1% or 0.01 in the example above. It’s also worth noting that the function’s final two parameters (FV and TYPE) are optional and, if omitted, are assumed to be 0. Separate the principal and interest elements for each month using a calculator. Use the following formula to calculate the total interest: Principal loan amount x Interest rate x Time (aka the number of years in the term) = Interest. For example, if you take out an INR 20,000 five-year loan with a 5% interest rate, the simple interest formula is as follows: s INR 20,000 x.05 x 5 = INR 5,000. Factors on Which EMI Depends a) The EMI is determined when the loan is approved and remains constant throughout the loan term, assuming that none of the factors on which it is calculated change. b) If interest rates change, the EMI may change. It is also possible to maintain the same EMI while increasing or decreasing the loan tenure to reflect changes in interest rates or loan prepayment. c) The EMIs are designed in such a way that the interest portion accounts for the majority of the payments made in the first few years. In later years, the primary component rises. Tips for Reducing Interest Burden While Repaying the Loan: a) Make sure that the principal amount is repaid as soon as possible. The lower the principal amount (due to earlier repayment), the lower the amount of interest to be repaid. b) The borrowed party can also pay one additional EMI per year (in addition to the usual number of EMIs). This is a useful method for reducing the length of the loan and, as a result, the interest cost. c) Choosing an EMI that one can afford through a shorter loan term results in a lower interest payment. It also increases the EMI burden. As a result, when deciding the loan EMI amount, always keep the budget in mind. The Benefits of EMIs Because the monthly payment is already known and broken down over the loan term, the EMI option will not be a financial burden and will allow the borrower to make other investments. EMIs calculators will allow one to calculate monthly outflow based on the principal amount, the interest rate charged, and the period. It is simple to plan for other expenses. Negative Aspects of EMIs In addition to the interest cost, the lending party may charge extra in the name of the processing fee. Missing an EMIs can have serious effects. The lender has the legal right to take over the mortgaged asset if failed on payments. Conclusion The principal is the loan’s original amount, and interest is the added charge one pays to borrow it. The principal and interest determine the total cost of a loan and the length of time it will take to pay it off. With this, one can go forward and make sound decisions regarding financial management to fulfil the desires. [B-02] FAQs 1) Can people with poor credit get loans? Yes. One does not need to have excellent or even good credit to obtain a loan. Credit-builder loans are intended for people who have no or little credit history. People with bad credit can also obtain loans. 2) Does EMI include interest and principal? Yes. EMI consists of two terms: principal and interest. EMI is the payment the borrower makes as a repayment of the sum borrowed. How can we use the EMI Calculator? 3) The following is the exact EMI formula for calculating EMI amounts: (P R/12) [(1+R/12)N] / [(1+R/12)N-1] = EMI P = principal (the amount borrowed); R stands for Annual Interest Rate. N is the number of monthly instalments. Dig into Piramal Finance for more knowledge.
08-11-2023
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Personal Loan

Risk Factors Involved in Financing your Holidays With a Personal Loan

In life, there might be situations in which one feels the need to take out a loan. This is the most accessible and convenient option. The list for this can be quite long. It can be for medical expenses, financing items, consolidating debts, etc. There are many loans that one can choose from depending on their needs. The most common one is a personal loan. It is also known as an “unsecured loan.” It is an open-ended loan and can be used for almost anything. In case one is planning to go for a lavish abroad trip on loan, there are a few things to consider. The idea of being able to go on a luxurious holiday on loan seems quite lucrative. One can easily avail themselves of a personal loan for holiday. But there are a few risk factors that one must know before applying for a loan. [B-01] What are the risk factors involved? The rate of interest: The fact that someone qualifies for a loan does not always imply that they should take it. It should be well-researched. The rate of interest for some loans can be less than 10%. On the other hand, there are few for whom the speed is relatively high. Most of the time, the rate of interest is fixed depending on the credit score. However, this particular law of improving the rate falls under the lender’s duty. So they can charge whatever they want to. One needs to be careful when checking the APR, i.e., the annual percentage rate. It can show manipulated data. Hence, it is best to check the total amount to be paid. It should include additional charges, interest, and the principal throughout the tenure of the loan. Knowing the ultimate cost of the loan is a better way. Know about the penalty charged for early payoff: Can a person lawfully pay back the loan before time? Will there be any charges associated with it? It depends on what kind of loan has been taken. If one is willing to take a personal loan for a holiday, then such research must be done. The loan can be taken from a bank, a P2P (peer-to-peer) lender, or even some agencies. They are paying off the loan before it is due, which should ideally be their target. So, to do so, one must carefully go through the fine print. It must be made sure that no such penalties are charged, and even if they are, they should be minimal. Big upfront fees: What money does one need to spend to get the loan in their account? The upfront fees can widely vary from one lender to another. One must ensure that the upfront payment is fair and in line with the market level. Several providers have a varying range of fees. So, it is essential to do research and not take the first loan that gets approved. There are privacy concerns: Loan unions and banks have some stringent laws for privacy. Many more options need to be more formal. But they are expected to maintain all the privacy laws laid down by the banks. Insurance pitch: There are many personal loan options that salespeople pitch. It has extra insurance for the loan to be protected in case of unexpected events in life. It might hamper the chances of someone repaying the loan. In this case, one can contact a trusted agent and ask for a quote on disability insurance. It will be relatively cheaper that way. It would also give them better coverage. Interests that are precomputed: The initial payment schedule is used to calculate interest using precomputed interest. It is independent of how much the loan has already been paid off. On the other hand, simple interest bases the claim on what is left to be paid off as of the current date. It is essential to check how the lender calculates the interest. One should opt for simple interest if one looks forward to paying off the amount before the completion of the term. If one is taking a personal loan for holiday, then such research must be done beforehand. Payday loans: Is anyone interested in taking a personal loan for holiday that is short-term? Then it is easy to get tempted by the payday loan. This offer might seem lucrative, but government agents and financial gurus advise against opting for this loan. The interest rate is quite high. It is also planned so that one will have to roll over the loan for an extra term. Unnecessary complications: Taking a loan is a really simple process. A person gives a certain amount to someone, and that needs to be paid back with interest. If an agency makes a lucrative offer, it is important to understand that they will never lose money on behalf of their clients. They are here to do business, which is all about making money. Personal loans are quite basic and easy to understand. If it is not, then it is a matter of concern. [B-02] Conclusion Loans are going to make a profit only for the lenders. The borrowers need money and have a convenient way to borrow the required amount. That does not mean they have a profit. So if one is taking a personal loan for holiday, it should be justified. If one is looking for a finance agency, Piramal Finance is a good personal loan or financing option for buyers.
08-11-2023
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Personal Loan

Is It Possible To Get A Personal Loan For Studies Abroad Without A Mortgage?

Personal loans for studies abroad are a popular form of loan to pursue your higher studies. This is especially the case with Indian students. Because of how easy it is to apply for a personal loan, many students choose this option, which is mostly done online. But for students without collateral, there are still personal loans they can apply for to finance their education. While most banks require collateral, there are some banks and other financial institutions that offer personal loans with no mortgage required. This article explores these options and how to prepare your documents to apply for these loans. [B-01] What Is A Mortgage Or Collateral? To know more about a personal loan for studies abroad without a mortgage, it is important to understand what a mortgage is. A mortgage is an asset that borrowers can keep as security against their loan amount. Mortgages can include a fixed deposit, real estate, gold, agricultural land and so on. Various banks in India provide an overseas study loan without a mortgage up to a certain amount. It has been shown that a personal loan with no mortgage has a higher interest rate and a shorter repayment tenure. Types Of Personal Loans Personal Loans With Mortgage Or Collateral A loan with a mortgage or collateral requires the borrower to pledge assets to obtain and secure their loan. This asset can be in the form of a house, property, jewellery, insurance policies, fixed deposits and more. The mortgage is taken to protect the lender’s money and provides security if the debtor fails to pay back the loan. Often, such loans help the borrower to get a loan at a cheaper interest rate. It should be noted that collateral security is not required for personal loans up to Rs. 4 lakhs. Only when the loan exceeds a certain amount will security and a guarantor be required, and this amount is established by the lender. Personal Loans Without Mortgage Or Collateral A personal loan for overseas studies without collateral does not need the debtor to offer assets as security. Borrowers must provide relevant documents and meet applicable standards and eligibility criteria. These standards are set by the bank or lender and must be met to take personal loans without collateral for studying abroad. Documents Required For A Loan With No Mortgage The following documents must be submitted to the lender when applying for a loan with no mortgage: The loan application form Proof of family income (income tax returns, property proof, etc.) Standardized test results Transcripts of academic work Aadhaar card (and/or other KYC documents) Birth certificate 6-month bank statements PAN card Acceptance letter from the university or institution Declaratory statement Eligibility Criteria For A Loan With No Mortgage A personal loan without a mortgage for studies overseas requires applicants to satisfy the following criteria: A minimum of 60% in high school is needed to ensure employability Income of a financial co-applicant Official documents related to the degree program in which the student desires to enrol Application Process For A Loan With No Mortgage This is the application process for a loan without a mortgage being offered: Research the different lenders and the loans they offer and carefully go through their details including the terms and conditions. Choose the best personal loan lender without a mortgage. Examine all terms and conditions, such as the moratorium term, payback tenure, education loan interest rate, and so on. Go to the official website of the lender you have selected. The online application option makes it easy for people to apply for a personal loan from the comfort of their homes. Complete the application form. Scan and submit the necessary documents. Is It Possible To Get A Personal Loan To Study Abroad With No Mortgage? Public banks like State Bank of India, Bank of Baroda and others provide such loans of up to Rs. 7.5 lakh. Private banks including ICICI Bank, Axis Bank, HDFC and others also offer loans to a certain limit without collateral, sometimes up to Rs. 40 lakh in some cases. Private banks have payback terms of 10 to 12 years and the interest rates are between 10 to 12%. Other creditors that offer loans include NBFCs such as Incred and Auxilo. These NBFCs provide students with loans without collateral of up to Rs. 40 lakh as well and the interest rate ranges between 10 to 18%. Some international lenders include Leap Finance and Prodigy Finance. They assist borrowers by providing an education loan without a mortgage. This loan can be up to 80% of the overall cost with interest rates that range from 10% to 16%. Top Indian Banks Providing Loans With No Mortgage HDFC Bank Up to Rs. 30 lakh for domestic education Up to Rs. 45 lakh for foreign education No collateral is required for loans up to Rs. 7.5 lakh ICICI Bank Up to Rs. 50 lakh for domestic education Up to Rs. 1 crore for foreign education No collateral is required for loans up to Rs. 20 lakhs for undergraduate degrees and Rs. 40 lakhs for postgraduate degrees Bank of India Up to Rs. 10 lakh for domestic education Up to Rs. 20 lakh for foreign education No collateral is required for loans up to Rs. 7.50 lakh HSBC No collateral is required for loans up to Rs. 5 lakh State Bank of India (SBI) Up to Rs. 15 lakh for domestic education Up to Rs. 1.5 crore for foreign education No collateral is required for loans up to Rs. 7.5 lakh. Punjab and Sind Bank Up to Rs. 15 lakh for domestic education Up to Rs. 20 lakh for foreign education No collateral is required for loans up to Rs. 4 lakh IDBI Bank Up to Rs. 20 lakh for domestic education Up to Rs. 20 lakh for foreign education No collateral is required for loans up to Rs. 4 lakh [B-02] Conclusion For students who want to study abroad but lack the finances, securing a loan is one of the most important aspects of their education plans. For the many students who require a loan but do not have any assets to offer as collateral, multiple lenders will provide a loan without any collateral. If the student meets the eligibility criteria, they can apply for a loan and improve their chances by preparing their documentation well and researching all their options. For more articles like this, visit the Piramal Finance website to read more about getting personal loans with no mortgage.
08-11-2023
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Personal Loan

Why People Mostly Opt For Personal Loans Compare To Other Loans

Huge financial expenses may not show up when you are prepared for them. Instead, they might crop up when you’re least prepared for them. At such times, the best way out is to apply for a loan. Nowadays, you have many ways by which you can get a loan as per financial requirements. However, as recent trends have shown, more and more people are opting for personal loans compared to other loan types. But why is it so? To answer this query, here’s an article that seeks to discuss in detail the various reasons that can be attributed to the popularity of personal loans among the masses. It also draws a contrast between personal loans and other types of loans to help you understand why personal loans are better than loans. Hence, without further ado, let’s get started! [B-01] 6 Reasons to consider Personal Loan over other loan types Following are some of the reasons to consider personal loans over other types of loans: 1. Debt Consolidation One of the most popular uses of a personal loan is debt consolidation, particularly credit card debt. Personal loans charge an astonishingly low-interest rate compared to credit cards if you have a good credit score. Hence, you can easily use this low-interest financial product to clear off high-interest debt. 2. An alternative to payday lending If you need cash to cover an emergency, a personal loan can be the best alternative to a payday loan. Payday loans are usually used for borrowing small amounts of money to meet your immediate expenses until you get your next paycheck. Although you don’t need loan collateral for payday loans, they are usually very expensive. Payday loans are also known as predatory lending because these loans have very high-interest rates, have hidden provisions that require the borrower to pay additional fees, and do not consider a borrower’s ability to repay the loan amount. On the other hand, personal loans have much lower interest rates and fees than payday loans. Personal loans also offer more time to repay the loan amount than a payday loan, which must be repaid as soon as you receive your next paycheck. Moreover, unlike a payday loan, a personal loan does not involve hidden charges. In addition, while you can use a personal loan to improve your credit history, provided you repay the loan amount in time, a payday loan doesn’t help you improve your credit score. This is because payday loan lenders often don’t report the lending to the three major national credit reporting bureaus. This means that payday loans don’t show up on your credit score report. Personal loans not only boost your credit, but an improved credit score will also qualify you for better loans and interest rates in the future. 3. Home Repairs and Improvement Homeowners can utilise either home equity or personal loan to fix damages or upgrade their homes. However, as opposed to unsecured personal loans, a home equity loan is a secured loan. This means that a home loan would use your home as loan collateral. If you fail to repay the loan timely, you will lose your home. On the other hand, since a personal loan is an unsecured loan which means that it doesn’t require loan collateral, you won’t have to worry about losing your home if you fall behind on loan repayments. In addition, compared to a home equity loan, you can more easily and quickly secure a personal loan. Moreover, if you use the personal loan amount for home construction, renovation, or for making a down payment for your house, you can claim tax deductions of up to 2 lakh as per Section 24 B of the Income Tax Act, 1961. However, this tax deduction is subject to certain terms and conditions. 4. Vehicle Financing You can secure an auto loan for buying or leasing a car. However, since personal loans can be used for a wide range of purposes, you can also use them for leasing, buying, or repairing a vehicle. Although auto loans usually have lower interest rates as opposed to personal loans, auto loans are secured loans and thus use your vehicle as loan collateral. On the other hand, personal loans are unsecured and do not require collateral. Hence, if you are worried about missing your loan repayments and getting your vehicle repossessed, then availing of a personal loan might be the wisest choice for you. 5. Quick Disbursal Since it is mostly in times of financial need, you tend to look for taking loans – the quicker the loan is disbursed, the better. However, not all loans are disbursed quickly. The disbursal period of a home loan is about 3 to 4 weeks. On the other hand, the period of a personal loan is merely 24 hours to 72 hours. However, you must have a good credit score and meet the required eligibility criteria to get your loan disbursed quickly. If you satisfy these two requirements, personal loans are doubtlessly the best financial product for addressing urgent payment or cash requirements. 6. The versatility of Personal Loans A personal loan, unlike other loans, can be used for a wide range of purposes. It can be described as a multi-purpose loan. Banks and lenders don’t impose restrictions or limitations on the end user. This is one of the best things about a personal loan. On the other hand, home loans can be used only for housing purposes, such as buying or building a home or renovating a house. Similarly, an auto loan cannot be used for anything other than buying a car. However, you can use a personal loan to buy a car, build or buy a home, repair your home, and so on. [B-02] Conclusion Personal loans undoubtedly stand out among many loan options due to their unique features. Hence, it is no wonder that more and more people are availing of personal loans as opposed to other types of loans to meet their financial needs. However, before opting for a personal loan, thoroughly review your financial condition to check whether a personal loan is an ideal option for you. Always remember that borrowing money must not be done on a whim. The good news is that you can now apply for a personal loan from Piramal Finance. It is a registered finance company that provides hassle-free, quick, and easy personal loans with zero prepayment and foreclosure charges. Their team of expert advisors would also help you through the entire loan application process, thus ensuring fast approvals and quick disbursals in your account. Piramal Finance also guaranteed minimum documentation and pocket-friendly monthly EMIs. For further details, visit the official website now!
08-11-2023
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