A personal loan can be your best financial ally whether you’re in immediate need of money or wish to make a purchase. Easy application method, fast approval, and minimum documentation are simply few reasons that make folks to go-to a loan possibility. Personal loans can be availed and provided for meeting personal desires. If you’re availing a personal loan, banks may or may not raise you to specify why you’re borrowing the cash. Personal loans are terribly easy to get in India, particularly if you have got the correct documentation in place. Most of the personal loan in Bangalore are provided by banks, however, there are different types of lending service who provide personal loan for bad credit history and also for the private unlisted company. Personal loans are normally small loans, and therefore the figures usually don’t exceed more than 10-20 lakh rupees. But do you know there are 5 different types of personal loans? And, all of these take care of your specific financial necessities and the type of loan that’s right for you may generally rely on what you need the loan for.

5 Types of Personal Loans you can avail in India

Fixed-Rate Loans

Most of the personal loans are fixed-rate loans. A fixed interest rate loan is a loan where the interest rate doesn’t fluctuate during the fixed period of time. This permits the recipient to accurately predict their future payments. Most home buyers look for fixed-rate loans after they purchase a home. Although the interest rate is higher than the other loan, this kind loan offers additional security.

Installment Loans

Most of the people consider installment loan when they think about the personal loan in Bangalore. Individual borrow a set amount of cash and repays it with interest at regular intervals time. These loans usually finance homes, cars, and alternative overpriced things. The loan tenure can vary from months to thirty years.

Payday Loans

In general, payday loans (sometimes known as cash in advance) are one amongst the foremost expensive borrowing choices, Charging extraordinarily high-interest rates and excessive fees. they’re a small, short-term loan secured against paycheck and are generally used for emergencies only. The amount due includes the principal amount you borrowed and the corresponding finance fees.

Convertible Loans

In finance, a convertible bond or convertible loan is a kind of bond that the holder can convert the outstanding loan amount into a fixed range of shares of stock of the company or money of equal worth. Commonly used for business, convertible loans permit lenders the option to convert the outstanding principal of the loan into an equity position in the borrower’s company, that over time, may be valued more.

Secured Loans

Secured loans are those loans that are protected by an asset or collateral like a home or automobile, as collateral to ensure repayment of the loan. If you fail to pay, the loaner takes your asset. The item purchased, like a home or an automobile may be used as collateral. The finance company or bank can hold the deed or title till the loan has been paid back, together with interest and all applicable fees. Other items like stocks, bonds, or personal property can be put up to secure a loan as well.

Choosing the Right Personal Loan

So, currently, you came know the different types of personal loans. Before applying personal loan think twice of the interest rate and you can also use personal loan EMI calculator for further reference. Obtaining the personal loan at low interest rates is vital, because choosing the wrong loan may end up costing a lot of in unnecessary fees and interest. If you’re unaware about the personal loan you can seek advice from an expert.