With the Government’s push on digitisation and cutting down on the red tape, taking loans for the common man has become easier than ever. You can apply for all sorts of loans with just the click of a button from the comfort of your home. Getting a Personal Loan, Home Loan, Car Loan, or any other loan is a task that requires very little work from your side. These days, you get immediate confirmation about your loan eligibility, and, some lenders even transfer the money as soon as your details are verified.
Do private sector banks provide Personal Loans?
Yes, almost all private sector banks provide Personal Loans. Banks like Yes Bank, ICICI Bank, HDFC Bank, Federal Bank, IndusInd Bank, Kotak Mahindra Bank Personal Loan and many other banks operating in the private sector provide loans.
What kinds of Personal Loans does Yes Bank provide?
Yes Bank Personal Loan is basically offered in the following three categories:
- Personal Loan for Holiday: This loan is provided to fulfil your holiday needs. You can use it on travel tickets, shopping, hotel booking and everything else.
- Personal Loan for Wedding: This loan is provided to finance a wedding to make the big day extra special.
- Personal Loan for Home Renovation: These loans are provided to finance your home renovation plans.
What are the details of the Yes Bank Personal Loan?
The Yes Bank Personal Loan can be borrowed for a tenure ranging from 12 to 60 months. The maximum amount that the bank lends is Rs. 25 Lakhs while the minimum stands at Rs. 1 Lakh. The rate of interest starts at 10.75%.
As is typical, your eligibility for getting the loan depends on some factors, like, your age, fixed income, debts, credit score and prior debt history among other things.
What are the benefits of the Yes Bank Personal Loan?
Yes Bank provides a very simple loan application process. The processing of the application is also very smooth and fast. The money is disbursed within hours of verification of documents and approval. The bank provides a very flexible repayment option for you, and you can repay the loan before completion after tenure after paying 12 EMIs. Apart from this, Yes Bank also provides you with the option of loan transfer.
What is a loan transfer?
A loan transfer is transferring your existing loan to another at a lower EMI and rate of interest. It can be done by either taking a Personal Loan at a rate of interest lower than your current loan or paying it off with the Personal Loan. Or, you can apply for a loan transfer at one of the many banking and non-banking financial corporations who provide a loan transfer facility.
What are the benefits of a loan transfer?
The benefits of a loan transfer are obvious. If you get a good loan transfer, you pay a less EMI than you were already paying. This is a great financial tool that you can use to cut back on costs. Loan transfer also helps if you want to transfer your loan from the lender to a different bank due to personal reasons or grievances.
How does a loan transfer work?
Basically, the bank to which you want to transfer the loan buys the loan from the original lender. Now, the bank the loan has been transferred to becomes the lender. You pay your EMIs and other charges to this bank only. Your loan with the first bank is paid-off. You then become a borrower of the bank the loan has been transferred to.
Can a loan be transferred from one bank to another?
Yes, many banks allow you to implement their loan transfer policy. One way to do this is simply taking a Personal Loan from another bank to pay off your existing loan. For this to be useful or profitable for you, the rate of interest on the Personal Loan should be less than the rate of interest on the existing loan. Or more accurately, the EMI that you will need to pay each month should be less than your existing loan’s EMI. For instance, you have an outstanding student loan of Rs. 1 Lakh with Bank A. Your current EMI is Rs. 5,000. You decide to take a Yes Bank Personal Loan of the outstanding loan amount of Rs. 1 Lakh with Rs. 2,997 as EMI, and immediately pay it off. You have paid off your student loan with Bank A, reduced your EMI, cut back on your expenses and made life easier for yourself and become a borrower of Yes Bank.
The other method is called refinancing. In this, you transfer your loan from one bank to another to enjoy paying a lower rate of interest. Here, you do not clear-off any debt. Instead, you simply become a debtor to another bank. You have to request your current lender, apply for a loan transfer, get existing lender’s approval and only then can you get your loan refinanced.
What is the procedure of refinancing?
Refinancing works through this procedure:
- Ask your current lender for refinancing documents
- Get approval and consent letter from a current lender
- Provide refinance documents, consent letter and all other documents that are asked for to the lender you want to transfer your loan to.
- The new lenders transfer the outstanding amount of your loan to the original lender, thus ending your liability towards them. You are now a borrower of the new lender.
- Original lender hands over all documents, papers of mortgages or security to the new lender.
After this process is complete, you become the debtor of the new lender. All your future payments are going to be paid to them. All your responsibility, liability and any relationship with the original lender, in so far as the loan is concerned, is over.