Personal Loan Processing Fees On Meeting Certain Criteria
Personal loans are a boon during a financial crisis. They can take care of any planned as well as unplanned expenses. Taking a personal loan has become simple and easy, thanks to the influx of various financial institutions.
When you take an instant loan, you will be asked by the lender to pay a certain amount as a processing fee. What is a processing fee for personal loans and is there any way to get a complete waiver on them?
What are loan processing fees?
At the time of availing a personal loan, you are asked to submit a few personal loan documents. Based on this, your loan is either approved or rejected. However, at the time of approval, certain costs are involved from the lender’s side as well.
These can include document verification, and administrative costs that occur while processing and sanctioning the loan. To cover these costs, the lender will charge you a certain amount. This is known as loan processing fees.
Loan processing fees are charged as a percentage of the principal loan amount. It also varies, depending on the financial institution. A minimum and a maximum percentage are fixed by them, which is paid by the borrower. Institutions tend to charge 0.5% to 3.5%, as loan processing fees.
What you need to remember is that processing fees for personal loans tend to be a one-time charge only.
What does the processing fee include?
There are a few elements that are categorized as instant loan processing fees. These will include all loan-related fees, documentation verification fees, and any penalty on the loan.
- Loan-related fees: This is a non-refundable charge that you will pay as an administrative cost. Some lenders ask for administrative fees before the loan is disbursed, whereas other lenders deduct them from the principal loan amount.
- Document verification charges: Once you upload the personal loan documents, it has to be verified. Without verification, the loan is not sanctioned. This process of verification attracts a cost and is to be paid by the borrower.
- Penalty on Loan: Though it is not technically a processing fee, it will be applicable if you miss an EMI, or decide to foreclose your loan.
- Additional Goods and Service Tax (GST): This will be applicable on processing fees.
Here’s the eligibility criteria for Personal Loan processing fees
Though a loan processing fee is charged by every lender, there can be ways and means to get a waiver on this. If you meet all the personal loan eligibility criteria as set by the lender, the chances of getting a waiver or reduction on the processing fee is possible.
Before applying for an instant loan, conducting a personal loan eligibility check is important.
Finnable’s eligibility criteria include:
- Age: You should be between 21-45 years of age.
- Nationality: As an Indian national, you can apply for a personal loan through Finnable.
- Employment: While applying for a personal loan, you should be holding a full-time job in a private or government organization.
- Tenure: This job should be held for more than 3 months.
- Work experience: You will also need to have more than 6 months of total work experience.
- Income: If you live and work in a Tier-I city, your monthly income should be more than Rs. 20,000/-. For a Tier-II applicant, the monthly take-home income should be more than Rs. 15,000/-.
- Income credit: Income should be directly credited into your bank account.
CIBIL score: It is not mandatory to provide a CIBIL score while taking a loan from Finnable. However, a good CIBIL score can help in the process of getting a waiver of the loan processing fee.
Conclusion
The processing fee on a personal loan may seem like an expense. However, what you need to remember is that the amount can be minimal. Also, getting a waiver is also a possibility.
One aspect like a processing fee should not stand in your way of taking a loan to fulfill your wishes and dreams. Personal loans from Finnable can be availed via the personal loan app.
There are various types of personal loans you can take from Finnable, including education loans, wedding loans, travel loans, medical loan, etc. These can be availed at affordable interest rates with a loan duration starting from 6 months up to 60 months.
