Page 115 - DMGT515_PERSONAL_FINANCIAL_PLANNING

Personal Financial Planning

Notes You may be eligible for a personal loan even below this income level but the interest rate
is likely to be very high.
These loans are likely to be more reasonably priced if you work for a top notch corporate
and have large provable income in double digit lakhs per annum.
A better and more convenient option is to take a gold loan. You need to provide jewellery
as security but the loan is significantly cheaper (and quick as well since it is available
across the counter or in a matter of hours) and your age and repayment history will not
matter.
If you have no jewellery you can look at getting a loan against your financial securities
such as shares, bonds, life insurance policies with high surrender values, mutual fund
units, etc.
But a personal loan is in any case better than borrowing on a credit card which is extremely
expensive.
Compare personal loan offers from various lenders across the country right from interest
rates to aspects of loans such as repayment options, charges applicable, documentation
before making a decision.
Current Personal Loan Interest Rates in India
Interest rates charged on personal loans vary across various banks. There are primarily 3
kinds of interest rates, most commonly offered by banks are:
(i) Fixed interest rate
(ii) Floating interest rate

(iii) Flat rate
Of the rates offered, flat rates can be considered the most expensive as in other cases, the
reducing balance method is used for calculation.

Personal Loan: Eligibility Criteria: Overview
You are eligible for a personal loan if you are a salaried individual, self-employed
individual (own business), or a self-employed professional (doctor, lawyer, etc.). Other
factors such as your income, age, residence, work experience, repayment capacity, past
obligations and place of work are also taken into account. A personal loan can be used for
any purpose provided it is legitimate; you need not mention the end use to the lender.
Compare various personal loan providers and decide for yourself the best option.

3. Car Loan/Vehicle Loan: Finance is provided for purchase of car or other vehicles either for
personal or business purposes.
Current Car Loan Interest Rates

Whether you want to buy a new car or an old one, you can get a car loan. Banks offer loan
on fixed as well as floating interest rates for a tenure ranging from 3 to 5 years. While fixed
rates have been in the market for a while, floating rates were introduced around September
2007.
Car Loan: Eligibility Criteria

If you have sufficient income and the wish to own a swanky car, new or old – you can get
a loan. Auto loans can be about 2.5–3 times the annual salary for salaried professionals or
6 times the annual income for self-employed professionals. For more details you need to
contact the concerned bank directly.

110 LOVELY PROFESSIONAL UNIVERSITY