Know What Types of Personal Loans are Available in India

A loan which you can get for any use of your choice is a personal loan. You can avail of personal loans from any bank or NBFC at different interest rates and tenure, depending upon your need and credit score.

Types of Personal loans

Various types of personal loans are available in India. You can categories them based on their nature and purpose.

Types of a Personal Loan Based Upon Nature: A personal loan is of various types based on its nature. They are as under:

• Unsecured Personal Loans: A variety of personal loans where you need not pledge any security or collateral. You can use a personal loan calculator to know the individual loan interest rate and EMI.

• Secured Personal Loans: A loan where you need to give security or collateral is known as a secured loan.

• Fixed-Rate Loans: You pay the same EMI for the whole loan tenure.

• Variable-Rate Loans: The loan where interest rates are dependent on a set rate as decided by the lender. Your loan rate changes as per the fluctuation in the set interest rate.

• Debt Consolidation Loans: When your multiple credits roll up into a single loan, it is a debt consolidation loan.

• Co-sign Loans: When your credit score does not make you eligible for a personal loan, you need a co-applicant. It improves your creditworthiness and chances of getting a loan.

• A Personal Line of Credit: This is like a credit card. You can borrow funds to a specific credit limit as and when you need.

Type of Personal Loan Based on the Purpose: The best part of a personal loan is that you can use it for any purpose you want to. On that basis, a personal loan can be of many categories like:

• Home Renovation Loan: When you avail a personal loan for renovating your home, it is home renovation loan. You can also use it to colour your house, redecorate it, or refurbish it.

• Education Loan: The purpose of this loan is to pay for your or your family member’s education. Many lenders offer private education loan, which has a higher interest rate. Personal loan proves to be economical and readily available.

• Loan for Wedding: This is a personal loan which you can avail to fulfil your dream of a destination wedding. It can cover expenses of the wedding, food, ticket bookings, venue charges and other costs related to your wedding.

• Funding for Vacation: A good vacation can cure you of tiredness, boredom and mental exhaustion. Sometimes, a dream vacation can make a big dent in your pocket. Availing a personal loan for a vacation can be an ideal option.

• Festivals Loans: Some lenders offer festival loans to celebrate your favourite festival in style. It helps in throwing a party on the festival day or giving gifts to family members.

• Pensioners’ Loan: It is a loan where pensioners can avail around 7 – 10 times the amount of their pension in the form of a loan. They can use the sum for their daily expenses, likes medical bills, family function, family emergency, paying for some family event or emergency.

• Loan for Purchase of Appliances: This is a type of personal loan for the purchase of consumer durables like TV, washing machine, etc.

• Loan for Computer or Laptop: Some lenders offer personal loan for the purchase of the latest computer or laptop.

You can avail a personal loan quickly and instantly by the online application process and can use it for any purpose of your choice.