Personal loans

T.Y.BBI PERSONAL LOAN
INTRODUCTION
A loan is a redistribution of financial assets over a time between the
lender and the giver of the loan. The borrower initially receives an
amount of money from the lender, which they pay back usually but
not always in regular installments to the lender. This service is
generally provided at a cost, discounted as interest on the debt, to the
lender. Acting as a principal of loans is one of the principal task for
financial institution for banks. Loans are generally funded by
deposits for other institution issuing of debt contract, such as bonds is
a typical form of funding.
Due to rising of basic needs, personal loan facilitated by various bank
play a vital role in fulfilling the people desire of buying their dreams.
They are ideal when we need or buy a product for ideal when do not
have ready cash.
Personal loan are better choice compared with consumer durable
loans. In fact before we consider taking a consumer durable loan we
might consider a personal loan instead as the procedure is slightly
longer but the rate of interest is lower. Flexibility of duration and
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availability of various schemes make personal loan an attractive
option.
It is an all purpose a loan, which is given in most cases without any
kind of security like a car, home, shares or any kind of property.
Most nationalized, foreign, and co-operative banks offer personal
loan. Besides banks, some other finance companies and financial
institution also offer them.
Lending rates differ for different financiers and currently from 12%
to 30%. These loans are available in the range of Rs 15000 to Rs 10
lakhs. The repayment period varies widely; some lenders usually
permit repayment up to a maximum of 60 months. And most lenders
restrict the lending to a maximum period of 36 months.
Most bank will give anywhere between Rs20, 000 and Rs10
lakhs (Rs 1 million) for a maximum for period of 60 months. To be
eligible for the loan you need to be between the age of 25years and
58years in case of a salaried individual or between 25 years and
65years if you are self-employed.
While issuing the loans, banks look at factors like your salary or
profit, the number of years you have worked in a particular
organization and the number of years you have stayed in your current
residence.
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Advantages and disadvantages of personal loan
With a lot many lenders on the block willing to offer their loan
services to all, applying for a loan nowadays, is no longer a problem.
Gone are the days when you had to wait to buy something or go out
and do what you wanted to, because a hassle free and available to all
personal loan is now no more a dream, but a reality.
Today, various loans are available in the market to suit individual
needs of the people. In Personal Loans as well, different types of
loans are available. They can serve you well in your financial
limitations while making your living better. No delay should be done
in availing a loan especially when it suits your financial situation and
can be available to you in a desired time.
A personal loan is often described as unsecured loans because it
allows you to borrow money without having to provide security
against it. You can use the personal loans for the purchase of your
house or a car. The personal loans are better for a longer time period.
Following are some of the advantages of the personal loans-
- While making an evaluation of the cost of the loan you need to
consider the TAR (Total Amount Repayable) which means that the
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total amount that you owe towards the bank or a lender which also
includes the rate of interest on the loan and the payments need to be
made on a monthly basis. A suitable deal is where you get a lower
TAR.
- The maximum amount that you can borrow ranges up to £25,000
and the time period for the refund is up to ten years. The advantage
with the personal loan is that when you take a maximum amount as a
loan then you have to pay a lower rate of interest.
It is totally different from the terms and conditions for the mortgage.
The unsecured personal loans are not protected for your property so
if you are not able to refund the loan then you can be rest assured that
your house is safe.
- The interest rates for the personal loans are also fixed. This makes
it easy for you to make a planning for the payments that has to be
made. The refunding amount also remains stagnant all the way
through the time period of the loan.
- With a dynamic market scenario of loans the rate of interest has
seen so many ups and downs. Now to get a loan it has become
simpler than ever before. The financial companies offer you loans
through their telephone service. They have toll-free numbers and
they guide and provide you the best deals and offers.
Following are some of the disadvantages of the personal loans:
- Various financial companies and clever lenders introduce certain
plans like- make a purchase and pay it later, offer free gift items, etc.
These will only raise your price of the loan. So take a wiser decision
and go for the basic loan with favorable terms and conditions.
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Always make a choice for those loans which have a low rate of
interest and where the terms of the refund are moderate.
- Don’t make a hasty decision in choosing a personal loan. It is not
right to take a loan from just another bank. Make a survey and try to
find out various offers and plans that various other banks and
financial companies have to offer. Now with the internet things has
become very simpler. You can visit various financial companies,
what are the offers and plans these companies are offering.
Accordingly you can take a decision whichever plan suits you.
- The PPI (Payment Protection Insurance) provides you the refund
on a monthly basis if you are not able to work, you have met with an
accident, in case you have suffered a heavy loss in your business, you
are not employed anywhere, and make a payment for your loan in
case of your death. You should be aware of this type of insurance as
it is a costly affair and it adds an amount ranging from £1,000 to
£5,000.
- According to a survey majority of the personal loans are paid off
before the completion of their tenure. You need to look out for those
lenders who take heavy amount for the settling of your loans before
the tenure.
- You have to handle the annual percentage rates very carefully as
it entirely depends on your financial credibility. You probably
might not be eligible as to be entitled for it. You need to have a
good credit history otherwise you won’t be able to qualify for
the lender’s potential customer list.
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Here are few guidelines before taking any concrete decision
regarding the personal loans:
- Analyze all the offers and schemes before applying for the loan.
There are various lenders who are not real and their motive is just to
earn profits.
- To be entitled for a personal loan the procedure followed is
rigorous although there is less documentation involved in it.
- Go through the contract thoroughly and reassess the closure price
and for any hidden cost (If any). It is an important step which will
only benefit you.
- If you are planning for a personal loan then most of the time it is
cheaper than getting a credit card.
- Excluding the consumer durable loans the rate of interest for the
personal loans are high.
Personal loans - Special emphasis on bad
credit personal loans
Before approving a loan application, the lender
calculates
the following two affordability parameters to make
sure that the chances of repayment are not bleak:
• Credit history, to ascertain the loan seeker's past
financial record as good or average or bad.
• Debt to income ratio (DTI = Debts/Income), to
compute the loan seeker's current monetary position.
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Depending on the above-mentioned calculations, the
lender categorizes the loan seeker as: prime customer
(person with a good credit record), near prime
customer (person with an average credit record) or
sub-prime customer (person with a poor or bad or
adverse credit record).
A sub-prime client is further categorized to get a
better idea of the hazards that he may pose - low
adverse credit, medium adverse credit or heavy
adverse credit. After this detailed evaluation and
classification, the lender approves the loan
application/amount and decides the loan
terms/conditions.
Sub-prime loan seekers can avail credit support under
the 'bad credit personal loans' category. Available
in both secured and unsecured form, this special
personal loan sub-category helps people bring their
lives back on track.
For obvious reasons, prime and even near-prime
customers can negotiate for a favorable loan deal. But,
sub-prime customers have to settle for high APRs, and
stringent loan terms and conditions. Still, secured
loans are more gainful and are generally easier to get
as compared to unsecured loans.
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Secured bad credit personal loans, the best
solution for homeowners and property owners are
comparatively safer for the lenders, as they are
availed by pledging collateral. As a result, there are
chances that the loan seeker may get a less stringent
loan deal.
But, unsecured bad credit personal loans, probably the
only option for those UK residents who are incapable
of offering collateral, are risky for the lenders, as they
are availed without pledging collateral. As a result, the
creditor cannot afford to offer a flexible loan deal.
How to ensure a safe personal loan?
The online media for applying for loans is becoming
increasingly popular these days. Being time saving and
convenient, it's preferred by most of the borrowers.
Nobody likes visiting the bank manager in persona to
apply for a loan. But, one must ensure that s/he is
applying to the right lender and not to a loan shark.
Loan sharks are unlicensed lenders who take
advantage of those who are rejected elsewhere or are
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suffering from extreme bad credit. These lenders
usually prey on vulnerable people like the unemployed,
lone parents, bad credit holders, etc.
So, whenever you apply for personal loans, make sure
that the online lender you are dealing with is
registered with OFT (Office of Fair Trading) and
regulated by FISA (Finance Industry Standard
association). Loan sharks are not licensed and
therefore they operate outside the law. These
unlicensed moneylenders charge very high interest
rates and use violence and threat if the borrower is
unable to repay the loan.
Personal loans should be taken with great care and
caution. The loan agreement should be read carefully
before signing and if needed, professional help from a
financial consultant should be taken. An unlicensed
lender otherwise may make you life hell. He does the
following:
• Grant you personal loans on very expensive rates
• Harasses you if you fall behind your repayments
• Pressurizes you to borrow more from them to
repay your existing debts
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Personal cash loan
It can be a viable short-term solution for temporary monetary
problems because these allow consumers to receive funding
for bills, expenses, and other necessary costs. When handled
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wisely, they can improve an individual’s current financial
situation. When not handled wisely, however, a personal cash
loan can lead to serious trouble. If help is needed, funding can
be qualified for quickly, with little documentation. However,
because of higher interest rates and serious default terms, one
should cautiously consider taking out this form of funding.
There are many different funding programs, including payday
advances, cash advances or other unsecured cash loans.
They are available through store-front and financial
companies, as well as on the Internet. While there really are no
regulations for which a personal cash loan can be used,
people typically use them to help pay bills on time, or to pay for
some unforeseen expense that they do not have adequate
savings to cover. Unfortunately, some people may also use
personal cash loans to meet their perceived need for instant
gratification. Using money in this manner can get a person into
financial trouble quickly. Because these programs can have
high interest rates and little tolerance for missed payments,
they are best used in emergency situations, or when the
borrower knows they can repay the obligation.
Getting a personal cash loan can be quick and easy, which is
good for the person who is in financial need. Lenders who offer
personal cash loans do not have many requirements. Most
lenders require the borrower to be at least 18 years old and to
have had a checking account open and in use for at least 90
days. The borrower also must show documentation that proves
they receive a minimum of $1000 per month to qualify. Most
lenders typically do not require good credit and rarely run
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credit checks for instant loans. However, lending companies
may check for other outstanding debts or in-process
bankruptcies.
This funding can be a blessing or a curse to the one who is
borrowing. When a person takes on a personal cash loan, it is
important to realize they are in debt to the lender. As the Bible
says, "borrower is servant to the lender" (Proverbs 22:7). This
can be very overwhelming and should encourage the individual
to seek financial freedom. However, unforeseen financial
difficulties sometimes arise and people need personal cash
loans to pay these obligations. It is important to be very
selective in this process and choose lenders that offer the
lowest rates and best terms.
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Personal loan guaranteed
Personal loan guaranteed are available from many sources,
and are relatively easy to obtain either through the Internet,
finance company, bank, or even a credit card company for
anyone with collateral. The quickest (and apparently most
common) financing is payday loans. They are secured by the
next paycheck, and allow the borrower to receive funds
between paydays. They do not require a credit check when
they are short term and $500 or less. There is a fee for this
type of financing that is taken out up front, so actual funds
received from a personal loan guaranteed are the amount less
the fee.
When larger amounts are needed, such as to buy a computer,
or furniture, or to pay tuition or vacation expenses, a credit
check will most certainly be done. In that case, in order to
avoid having several companies check credit (and thus
lowering personal credit rating), it would be wiser to use a
broker who would make a one-time check and pass that
information on to possible lenders. A bank statement and
paycheck stub will be needed to prove earnings enough to
qualify for this personal loan guaranteed. Typical fees for
personal loans guaranteed are 15-30% of the amount
borrowed.
When one has to begin borrowing on future paychecks or on
the home, it may a good time to review financial priorities. It is
important to keep money in its proper place: "For the love of
money is the root of all evil: which while some coveted after,
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they have erred from the faith, and pierced themselves through
with many sorrows." (1 Timothy 6:10). Remember that God
promises each person who believes in Him treasures
unimaginable in heaven. Don't store up treasures here,
concentrate on the best that is yet to come.
Another source is the home equity line of credit. The larger
personal loans guaranteed by the equity in the home are good
for debt consolidation, home remodeling and the like. The
interest rate is lower than the payday loans. This kind of
financing equates to a second mortgage, and if selling a home
before it's paid off, that personal loan guaranteed comes out of
the sale proceeds first. When counting on the proceeds of a
house to make a down payment on the next one, this could
present a serious problem. The best way to handle this kind of
personal loan guaranteed is to stay put until both the loan and
mortgage are paid off.
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There are basically Two Types of Personal Loans:-
1) Secured loan
2) Unsecured loan
1) Secured loan
a) The loan that is secured against some sort of fixed or
immovable/movable asset is known as secured loan.
b) This sort of guaranteed personal loans is easily available on
account of the collateral that is provided alongside; thereby making
the lending institutions more comfortable in forwarding the loan.
c) Secured personal loans involve rates of interest that are much
lower and easy options for repayment.
d) Due to the collateral that is provided, banks and financial
institutions usually are unperturbed by defaults in payments or by
debts that are pending.
e) Secured personal loans are made available to the individual within
a period of thirty days after submitting an application.
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How Does A Secured Personal Loan Benefit the Borrower And
the Lender?
1. Secured Personal Loans can be repaid over a longer period of
time, with a lower monthly payment.
2. They are cost effective on account of the low rates of interest
charged on the loan.
3. Since the loan has been secured by pledging the assets of the
borrower, the risk to the lender's investment is greatly reduced.
4. Their easy availability is another factor. Very few loan
applications for secured loans are turned down; since the loan
would be secured on the strength of the borrower's assets
Secured personal loans can only be obtained by a borrower after
keeping an asset such as real estate property, car or jewelry as
collateral with the lender.
These kinds of loans help the lenders make sure that they will get
their money back, and hence they approve and provide the loans for
any amount of money with more security. Other than that, the
approval of the loan application also depends a lot on the borrower’s
credit history, his current monetary position, his current employment
status and the obtainable equity in the deposited collateral.
2) Unsecured loan
An unsecured personal loan allows you to borrow money without
having to provide security against it, such as your home or car. This
is what makes a secured personal loan different from unsecured
personal loan. The people who don’t own their own house and
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students who are living away from their home are the most suitable
borrowers of unsecured personal loans.
If you don’t have enough financial resources to repay the loan and
those who don’t want to put their costly items in jeopardy, then the
unsecured personal loans are the best option for you. You have the
danger of getting your property seized in secured loans and
unsecured personal loans are total contradictory to it which offers
less botheration to the borrowers. Usually the borrowers are attracted
towards those offers where you are hassle-free. These all factors are
the major contributors to the popularity of the unsecured personal
loans.
An individual can take a personal loan for a variety of reasons.
Loans for personal debt help provide funds to purchase your dream
car, pay for your mortgage or home improvement requirements. In
fact unsecured personal loans help meet most of the financial
emergencies that an individual can think of. The main advantage of
the unsecured personal loan is that anybody is entitled for an
unsecured personal loan whether with a good credit or a poor credit.
Generally it has been witnessed that a borrower with a poor credit is
not given the unsecured personal loans easily by the lenders. But
there are some lenders who still provide unsecured personal loans to
the people with poor credit. There are people who have the privilege
of unsecured personal loans after being a bankrupt or after their
property being taken over.
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The rate of interest is higher for the unsecured personal loans as
compared to the secured personal loans. In the case of unsecured
personal loans the lender is at a risk because incase you are not able
to make a repay of the loan then the lender has nothing to take the
possession of as there is not collateral made against the loan.
The unsecured credit line and unsecured credit cars are also forms of
unsecured personal loans. The unsecured credit cars are offered to
those borrowers those who are financial stable and have a good
financial background. For unsecured credit card you need not deposit
a considerable amount and on the contrary to this you have to make a
decided amount in advance in secured credit cards.
The main and the most important factor of the unsecured personal
loan is that you need not deposit any collateral against the loan to the
lender. Through unsecured credit line the businessmen are benefited
the most as they are in need of cash. The unsecured credit line is
offered according to one’s financial status. It is up to the business
man what he wants to do with the credit whether he uses to buy some
machines or use it to expand his business. It is evident that the
interest is only charged on the amount you have taken.
The rate of interest for the unsecured loan is relatively higher than
the secured loans. No doubt that unsecured personal loans are the
most preferred by majority of the people but there are some strict
rules and guidelines attached with it. Before you arrive to any
concrete decision you need to have all the details of the details
pertaining to the unsecured personal loans. It is true that you don’t
have to make any collateral for the unsecured personal loans but still
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the refunds has to made on time. Just in case you fail to make a
refund of the loans there are probabilities that you can face federal
lawsuit against you which will only make the matter worse. Your
current financial status will be affected and in a worse scenario you
will be denied for any form of loans in the coming time.
Some important facts about unsecured personal loans:
- For unsecured personal loan you need to have a good past financial
record. The basic condition for offering an unsecured personal loan is
your credibility to refund the loan.
- For getting an unsecured persona loan you do not have to deposit
any collateral against the loan with the lender.
- The loan approval process of the unsecured personal loans is very
quick the reason being less paperwork is put into use. There is no
appraisal of the property involved adding to the fast approval process
of the unsecured personal loans.
- The loans are approved achieving a target of £25,000.
- The rate of interest of the unsecured personal loan is dynamic in
nature and can differ from seven to thirty percent.
- The terms and guidelines of the unsecured personal loans are not so
favorable. The time period for the repayment of the loan can vary
from six to ten years. Under this condition the smaller the loan period
the more you have to pay on a monthly basis.
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The Benefits behind an Unsecured Personal Loan
• There is no requirement of collateral, and the borrower need not
pledge his assets to procure the loan.
• There is no necessity for documents regarding the borrower's tax
returns, or for financial statements. The information on the
borrower's financial background need not be verified by supporting
documents.
Quick approvals, and an easy application process, are other attractive
benefits of this loan
Unsecured loans + unsecured personal
loans - Favorites among the borrowers.
In the last two years, the percentage of unsecured
loan takers has increased considerably in the UK loan
market. Not only the tenants, most homeowners also
prefer taking loans without pledging any asset,
especially the home, as security to the lender. The risk
of repossession of home plays heavy on the minds of
the borrowers, when they weigh different loan options.
Unsecured loans are masters in luring customers
because of the features cited below:
• Available for a range of different amounts and
repayment terms.
• Not secured against any asset.
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• No restriction on the purpose of availing loan.
• Amount available usually ranges from £500 to
£15,000.
• Loan tenure may stretch from 6 months to 10
years.
• Different lenders offer different APRs.
Most borrowers wonder that if nothing is secured, then
on what basis the loan amount is calculated for
unsecured personal loans. There are many factors
that play a vital role in deciding the amount to be
granted as unsecured loans. Some of the parameters
are listed below.
• Credit History of the borrower- A borrower with
few arrears, defaults, and miss payments is more
likely to get a greater amount than the one who has
an unhealthy credit record. So, better the credit
score of the borrower, higher the amount granted as
unsecured loans.
• Disposable income of the borrower- By disposable
income, one means the approximate income of the
borrower left per month after paying all living
expenditures, installments of other loans and credit
card payments etc. On the basis of this, the lender
decides how much amount the borrower will be able
to pay as the installment of the new loan.
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• Debt to income (DTI) ratio- This determines the
affordability of the borrower. DTI is calculated by
dividing the monthly income of the borrower by his
expenditures. This reveals the paying capacity of the
borrower. If the DTI ratio is more than 0.36, the
borrower will get a good amount as unsecured
personal loans.
• Credit policies of the lender- Every lender has a
different credit policy. So, the loan amount, tenure
and the APR charged is subject to the lender's
criteria. For instance, the high street banks may not
at all provide unsecured personal loans to those with
bad credit history; whereas, an online lender may
approve the loan.
There are innumerable factors that help in determining
the loan amount of unsecured loans, the major ones
being discussed above. The borrowers' requirements
and say also works. In most cases, the borrowers
mention the purpose for which they are procuring
unsecured loans in the loan application form. As per
the purpose, the lenders grant unsecured loans.
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Short Term Personal Loans
Short Term Personal Loans can be got through banks and online
financial companies, and a wide variety of other sources. With such a
Short Term Personal Loan: The rate of interest involved is usually
high. This is because the period of repayment is usually for a short
time. Such types of short term personal loans have to be beneficial to
both the borrower and the lender, and high rates of interest are one of
the ways by which a bank or a financial company stands to benefit.
- This type of short term funding is often utilized to help
individuals who are in need of varying sums of money for a
short period. Many of the lending companies usually provide for
such a loan, and also stipulate the maximum amount of money
that can be borrowed under such a circumstance.
- Banks, while giving this type of short term personal loan,
usually require collateral, before disbursing the same. Online
financial companies only require a credit check, but lend very
small sums of money. Banks do not offer more than $15, 000 or
$20, 000 dollars as well, and individuals seeking larger sums of
money, would have to tap other sources for funding.
- Because of the negative and positive aspects of short term
personal loans, it is recommended that the individual does his
research thoroughly, before he applies for funding.
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Fast Cash Advance Loan
Sometimes, you may be in need of a quick payday loan, so that you
could meet an unexpected money crisis. Car repair and other
unexpected bills usually occur at inconvenient times. In case you do
not have the extra cash to meet these unexpected expenses, you could
really consider applying for a cash advance.
A Fast Cash Advance Loan:
- Is similar to a bank loan- only cash advances are a lot easier to
qualify for, and enjoy a shorter term. Chances that your
application for a bank loan may be denied are high as banks
have a requirement of sufficient income, a collateral and good
credit rating.
- Has a two week term. Therefore your loan is due along with
your next paycheck. Requires that the applicant must be at least
18 years of age. The cash advance company would also be
checking out /confirming your salary and employment. While
the company is keen to help you out, it also wishes to satisfy
itself that you can repay the loan.
- Renders you eligible to receive funds up to a maximum of
$1000, with a cash advance. Some companies allow larger sums
to be borrowed.
- Typically fast cash advance loans are due within the period of
two weeks. Taking the circumstances of the borrower into
consideration however, some cash advance companies would
expect that at least half the loan amount will be repaid in two
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weeks, and the balance in a month. Such loans are called 30 Day
Payday Loans.
- But remember that before taking such a 30 day payday loan,
choose a company that allows for long term loans, and do not
assume that all cash advance companies would give long term
cash advance. Far better to enter into a long term loan
agreement, before taking the loan, otherwise you would have to
pay extra interest and fees for the late period.
Military Personal Loans are easy for servicemen to get anytime.
Military jobs involve good salaries and high status and sometimes
these could complicate matters by incurring extra expenses.
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An ICICI Bank personal loan is the one stop for all your financial
needs to fulfill any of your desires. You can now secure a fast and
easy personal loan for an amount up to Rs 15lakhs at attractive
interest rates, with an ICICI Bank personal loan.
With ICICI Bank personal loan you can get instant money for a wide
range of your personal needs like:-
1. Renovation of your house
2. A holiday with your family
3. Your child’s education
4. Buying a laptop or a electronic equipments
5. Medical expenses or any other emergencies.
The best personal loan cant’s get easier than an ICICI Bank personal
loan. To secure a instant personal loan all you need is one of the
following:-
1. A salary slip
2. Your credit card statement
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A PERSONAL LOAN OF ICICI BANK

3. Repayment track of an existing loan.
For instant, at ICICI Bank, your net salary needs to be 96,000
annually or you need to have a net after tax of Rs 60,000 per annum.
If you are a salaried individual you should have worked in your
current organization for at least 1 year and if you are self-employed
then you must have been running your business for at least 3 years.
You must have also been in your current residence for at least a year.
The loan is sanctioned within 3 working days. The processing fee is
generally around 2% of the loan amount and is deducted up front the
disbursement amount. Most bank charge pre-payment penalty of
between 3% to 5% of the remaining amount.
Objective
1. The various personal loan provides by ICICI Bank aims at
provides financial support from the banking and financial
system to the needy people for taking personal loan in India.
2. The main emphasis is that the needy people should be
provided with an opportunity to take personal loan with
financial support from the banking system with affordable
terms and condition.
3. To make people aware to take advantages of the various types
of personal loan provided by various bank.
4. To provide easy finance to the people.
FEATURES
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1. Personal loan with a peace of mind: - ICICI bank personal loan
provide a free life insurance cover (including total and
permanent disability due to accident or sickness) to the value
of the loan outstanding. The insurance cover is for outstanding
balance of the personal loan as on date of death or total and
permanent disability due to accident or sickness, will be
covered excluding any defaulted installment.
2. A loan for every one: - loans for both salaried and self-
employed personnel with freedom to jointly apply with your
spouse.
3. Quick and hassle free loan:- quick processing time of 24 hours
with hassle free documentation. No security or personal
guarantors required.
4. Get more from your loan:- we offer attractive interest rate with
loan from Rs 10,000lac to Rs 1,00,000 lac or to 10 times to the
net remuneration whichever is lower.
5. Flexible repayment option:- you have flexibility to Choose the
repayment period of upto 5 years (60 installments) and we also
allow early settlement at a nominal fee.
6. Loan ranging from Rs 20,000 to Rs 15 lac
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Eligibility Terms for your Personal Loan
You can avail of an ICICI Bank Personal Loan if you meet the
following criteria:
Criteria Salaried Self - Employed
Age 25 yrs. - 58 yrs. 25 yrs. - 65 yrs.
Net Salary Net annual
income - Rs.
96,000 p.a
Net Profit after tax
- Rs. 60,000 p.a
Eligibility Employees of
Public Ltd. cos.
Private Ltd. cos.
MNC’s Or
Government.
Doctors, MBA's,
Architects, CA's,
Engineers, Traders
& Manufacturers
Years in
current job /
profession
1 Year 3 Years
Years in
current
residence
1 Year 1 Year
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Documents
Documents
( Pre Sanction)
Salaried
Self
Employed
Latest 3 months Bank
Statement (where
salary/income is credited)
Yes Yes
3 Latest salary slips Yes
Last 2 years ITR with
computation of income /
Certified Financials
Yes
Proof of Turnover (Latest
Sales / Service tax returns)
Yes
Proof of Continuity current
job (Form 16 / Company
appointment letter )
Yes
31

Proof of Continuity current
profession (IT Returns /
Certificate of business
continuity issued by the bank)
Yes
Proof of Identity (any
one)Passport / Driving
License / Voters ID / PAN
card / Photo Credit Card /
Employee ID card
Yes Yes
Proof of Residence (any one)
Ration Card / Utility bill / LIC
Policy Receipt
Yes Yes
Proof of Office (any one)
Lease deed / Utility bill /
Municipal Tax receipt / title
deed
Yes
Proof of Qualification Highest
Degree (for Professionals /
Govt employees
Yes Yes
32

Service Charges for your Personal Loan
Enclosed find the service charges for an ICICI Bank
Personal Loan
Prepayment of the loan is possible after 180 days of
availing the loan.
Foreclosure charges as applicable would be levied on the
outstanding loan.
Part pre-payment is not allowed.
No other fees or commitment charges are levied.
Description of
charges
Personal Loans
Loan Processing
Charges /
Origination
Charges
2* % of loan amount +
Origination Charges of 1%
of loan amount
Prepayment
Charges
5% on the principal
outstanding
Charges for late
payment (loans)
2% per month
Cheque Swap
Charges
Rs. 500/-
Cheque bounce Rs. 200/-
33

charges
Note:
1) Origination Charges are included in the Advance installments/
First installment.
2) Service Tax and other govt. taxes, levies, etc.
Application Process
34
Information
Application to bank
Processing application
Documents
Verification

Key Benefits
1. Small business loan with no mortgage and no security required
2. The loan is provided in the form of overdraft, letter of credit or bank
guarantee and you can borrow upto a maximum of Rs. 25 lacs.
3. Faster sanction.
4. Flexible payment scheduled- Part payment or Pre payment.
5. One stop solution with a bouquet of products.
Security
Personal loans are very flexible. They do not required collateral securities or
assets banking. They are disbursed based purely on the financial of the loan
applicant. Additionally your spouse income can be considered in calculating
the loan amount provided he/she guarantees the loan or the loan is taken
35
Sanctioning of loan
Loan agreement
Disbursement of loan
Repayment

jointly.
Loan Repayment
Personal loan are repaid in the of Equated monthly installments. EMI are
calculated based on the loan amount, the rate of interest and the tenure of the
loan. “Banks calculate interest using the reducing balance method. The actual
interest is calculated on a daily reducing balance”
Transferability
If your lender is charging a high rate on your loan and you are able to find
another bank willing to lend at lower rate, you can transfer loan to the new
bank and thereby reduce the cost of your loan.
Advantages and disadvantages of different loan programs
Loan Program Advantages Disadvantages
Fixed-rate mortgages Predictable monthly payments
Less risk if market conditions
cause rates to rise
Rate does not change
You pay more in interest
Higher interest rate
Unable to take
advantage of lower interest costs
if market changes to lower rates
Adjustable rate
mortgages
Flexibility
Lower initial monthly payment
You pay less for short term
ownership
May be easier to qualify for
higher loan amounts
More risk
Inability to predict future
housing costs
Potential higher
payments (at max. interest rate)
Stated income
mortgages
Don't need to verify income Higher rates
Need a low LTV to
qualify
36

Combination loans
(such as an 80/10/10)
Avoid PMI
Potential tax advantages
Possibly higher monthly
payments
Two monthly payments
instead of one
Combination loans
(such as an 80/10/10)
Avoid PMI
Possibly higher monthly
payments
Two monthly payments
instead of one
Home equity line of
credit
Flexible access to funds
You only draw what you need
You only pay interest on what
you borrow
Ties up equity making it
unavailable for other needs
Higher interest rate than
a first mortgage
Home equity loan Predictable fixed payments
Possible tax advantages
Ties up equity making it
unavailable for other needs
Higher interest rate than
a first mortgage Cannot pay
down and withdraw additional
funds
Types of Personal Loans
On the basis of mode of repayment, personal loans are of
three types - installment loans, balloon loans and single
payment loans. Installments loans are repaid in the form of
monthly installments. The monthly installments carry both the
principal and the interest elements of a loan amount. In case
of balloon loans, interest is paid at regular intervals and the
principal amount is repaid at the end of the loan period. In
case of single payment loans, the entire principal as well as its
interest is paid at the end of the loan period.
Installment Loans: Installment loans are paid in regular amounts on a
schedule, usually monthly, until the loan amount is repaid. There are no
closing fees associated with installment loans.
Single Payment Loans: In this loan, the entire amount of the loan is
37

due at the end of the loan period. This is probably the most familiar kind
of loan to most people, where the entire sum of the loan is paid back at
once, only with interest.
Balloon Loan: Similar to single-payment loans, balloon loans
sometimes allow more than one payment, but generally have most of
the amount due at the end of the loan period.
On the basis of mode of repayment, personal loans are of
three types - installment loans, balloon loans and single
payment loans. Installments loans are repaid in the form of
monthly installments. The monthly installments carry both the
principal and the interest elements of a loan amount. In case
of balloon loans, interest is paid at regular intervals and the
principal amount is repaid at the end of the loan period. In
case of single payment loans, the entire principal as well as its
interest is paid at the end of the loan period.
38

HSBC Bank offer wide range of personal loan like:-
Home renovation or other home related expenses.
Marriage expenses.
39

Travel expenses.
Education expenses.
Transferring an existing loan from another bank.
Purchasing consumer durables or equipment.
Retiring other debts.
Any other personal needs and contingencies.
Flexibility to choose the EMI dates - 1st or 10th of every month
FEATURES
Flexible personal loan tenor of up to 5 years (i.e. 12, 18, 24, 36,42, 48 and 60
months).
Personal loans available from Rs. 50,000 up to Rs.15,00,000*.
Easy monthly repayment through Equated Monthly Installments (EMI) with
40

post-dated cheques or direct debit to your bank account from HSBC India.
Transfer of an existing personal loan from another bank to HSBC India, at
attractive interest rates.
No collateral/guarantor requirement.
Easy documentation, quick processing and disbursal.
Hassle free personal loan based on 12 months credit card/retail loan track
record.
Eligibility Criteria:
1. Applicant can be salaried / self-employed individuals and should be a
resident Indians.
2. Professional self-employed individuals eligible for a personal loan are
Doctors, Chartered Accountants, Cost Accountants, Company Secretaries,
Architects, Engineers and Management Graduates.
3. The minimum age of the Applicant / Guarantor should be 21 years for
salaried and self-employed individuals.
4.The maximum age of the Applicant / Guarantor at loan maturity should be
58 years for salaried individuals (60 years for Central Govt. employees) and
65 years for self-employed individuals.
5. The minimum years in continuous employment / business should be 1 year
for salaried individuals and 2 years for self-employed individuals.
6. The minimum net annual income should be Rs.75,000 p.a. (including co-
applicant's or applicant's income) for salaried and self-employed individuals.
41

7. The minimum stay at current residence should be 1 year for salaried and
self-employed individuals. Terms and conditions apply. All loans at the sole
discretion of The Hong Kong and Shanghai Banking Corporation Limited,
India. Loans available for applicants and properties in and around the limits
of cities where HSBC has branches and is subject to change from time to
time.
Documents
For salaried individuals
1. Latest salary slips showing statutory deduction.
OR
2. Form 16 (declaration from employer giving details of income and
deduction, duly signed by an authorised signatory of the company.
3. Latest acknowledged IT returns and
4. Bank statement for the last three months
For self-employed individual
1. Computation of income for last two year certified by a CA.
2. P/L and balance sheet for the last two years certified by a CA.
3. Copy of acknowledged IT returns for the last two year.
4. Bank statement for the last six months.
Photo identity (anyone)
1. Passport
2. Photo pan card
3. Defense identity card
4. Voters identity card
5. Driving license
6. Photo ration card
7. Government identity card.
Proof of residence (anyone)
42

1. Passport
2. Ration card
3. Telephone bill
4. Electricity bill
5. Driving license
6. Society out going bill
7. Voter ID
8. Life insurance policy
Note :
Only passport can be used as both proof of individual identity and proof of
residence address
Proof of age (anyone)
1. Passport
2. Driving license
3. Voter ID
4. School living certificate
5. Photo ration card
4 easy ways to repay personal loan
1. lower EMI in the first year
• You can start by repaying an amount you can afford today.
• After a year, you can pay a higher EMI.
2. Interest on utilise loan amount only , not on the entire loan
• Simply estimate the maximum loan amount you need. You can
43

withdraw money as when you need and interest will be charge only
on the amount you withdraw.
3. Last EMI waiver
• This repayment option gives you the benefit of getting a last EMI
refunded by paying a marginally higher interest rate (available for
loan of 48 months tenor only an applicable if you repayment is
consistent throughout the period of the loan.
4. Standard EMI repayment
• Your EMI for each month will be the same for the tenor of the loan.
Survey Report
I have done a customer survey from 1st
Aug., to 31st
Aug., 2007 about personal
loan provided by the banks in that survey I have asked a few questions to the
people and I have got following results:
Are you aware of the personal loan?
44

0
20
40
60
80
100
Aware Unaware
Aware
Unaware
Do you plan to pursue personal loan in future?
0
10
20
30
40
50
60
70
House Education Car Other
House
Education
Car
Other
Which bank would you like to prefer for pursuing personal loan?
45

0
20
40
60
80
100
Private Public Foreign
Private
Public
Foreign
What type of interest rate would you prefer?
0
10
20
30
40
50
60
70
Fixed Floating
Fixed
Floating
How much importance has the personal loan assume?
46

0
10
20
30
40
50
60
70
Low Moderate High
Low
Moderate
High
Do you think the procedure for personal loan is_
0
10
20
30
40
50
60
70
Convenient Lenghty
Convenient
Lenghty
Frequently asked question
1. What are the minimum and maximum loan amounts?
47

You can avail of loans ranging from Rs 20,000/- to Rs 15,00,000/-
depending on your eligibility, income and repayment capacity.
2. What are the loan tenure options?
The loan can be repaid over a period of 12 to 60 months.
3. Are there any additional charges?
A processing fee of 2% of the loan amount is payable upfront. This fee
will be deducted from the disbursal amount payable to you.
4. How much time will it take for my loan to be
approved?
Loans are approved within 72 hours of submission of complete
documentation.
5. Do I have to provide any security, collateral or
guarantors?
No security, collateral or guarantors are required for obtaining a
Personal Loan.
6. How do I repay the loan?
You can repay the loan in Equated Monthly Instalments (EMI's) through
post-dated cheques favoring ICICI Bank Limited, or if you have an ICICI
Bank account you can mandate us to directly debit the same.
7.Can I prepay my loan?
Yes, you can prepay the entire loan outstanding anytime after 180 days
of availing the same. Prepayment charges as applicable would be
levied on the outstanding loan amount. No part prepayment is allowed.
48

8. Do I need to open an account with ICICI Bank for
availing and/or servicing the loan?
We will encourage you to start a banking relationship with us so that we
will be able to offer a host of other value added services, which are
complementary to the loan, however opening an account with us is not
mandatory.
9. How do I approach ICICI Bank for a Personal Loan?
You can approach us in any of the following ways
• 24 hour Customer Care Centre
• Apply Online
• customer.care@icicibank.com
• You can just walk into any of any branches.
49

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