A personal loan is an unsecured loan. It means that you do not have to provide collateral, as is the case with a vehicle or home loan. The underlying asset is owed to the bank and no guarantors are required. Some advantages of obtaining a personal loan are,
- Speedy clearance
- Minimal documentation
- The loan amount can be used for any purpose
- No monitoring of ‘end use’
How Much Can I Borrow From A Bank?
Before you apply for a personal loan, you should find out about a bank that offers an attractive interest rate, EMI options, etc., as well as the eligibility criteria and the documents to be submitted. The eligibility criteria for a loan may vary from bank to bank. It is important that you are able to repay the loan and the monthly installments should not exceed 30% to 40% of your salary.
How much can I borrow for a car loan?
Having your own car is a dream of many. But the fact is that not all people are wealthy enough to buy a car. In such cases, a person will opt for a car loan. Before you apply for a car loan, take a look at the financing programs offered by various banks. Choose a bank based on three important factors, namely:
- Grant money scheme
- Advance EMI scheme
- Deposit payment system
But in the end, it depends on the interest rate of the loan. The amount of the loan you receive depends on:
- The type of vehicle
- The cost of the car
- The percentage of financing offered
Most banks will provide 90% of the total amount as car loans, while some banks may not offer more than their limit. It is also based on the resale value of the car. So the bank may happen to get a high resale value. You will need to provide documents such as proof of income, in which the bank looks for your income tax returns for the last two years. And you may have to provide important documents such as tax returns, bank statements, payslips, proof of residence, etc. If you submit all these things, your loan will be processed within 2 to 7 working days. The EMI cannot be changed once you have signed the documents.
That’s it, folks! This article on “How much can I borrow from a bank?” is not an exhaustive list of what you can borrow. I hope you enjoyed the article. Don’t forget to write a comment in the comment box.
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