1. An unsecured loan, a personal loan is a secured loan (the bank does not require any security or collateral), compared to a secured loan when required to pledge a house or other collateral to get a loan.
2. Documentation simple: a personal loan can be accessed with a minimum of paperwork or documentation and does not take long to get, compared to a secured loan.
3. No specification on the end use of the loan amount: You are not required to disclose the end use of borrowed money, the banks are concerned that if the borrower can repay the loan with interest before the due date or and not confirmed by verifying income, employment or business of the borrower and other factors.
4. Large amount of loan: personal loan is a great way to meet loan requirements, you can take a loan ranging from Rs. 50,000 to Rs. 20 lakh.
Documents required for personal loans
The documentation process is very fast personal loan compared to secured loans. Following documents are required by financial institutions to process the loan application:
Identity of the test
3 to 6 months bank statements
Residence proof
Salary Slip
Guarantees and the same set of documents
In the case of self-employed banks require balance sheets, profit and loss account, partnership deed and other documents required, etc.