What is Unsecured Loan?
An unsecured loan is a personal loan that does not require any collateral or asset against the availed amount. Unlike secured loans like a home loan or a vehicle loan, the borrower is not under any compulsion to pledge any asset of value while availing the loan amount from a financial institution.
Unsecured personal loans are typically available for short-term cash crunch situations. Be it to meet the expenses of going on a vacation or renovating your home or even for medical expenses. Unsecured personal loans can be availed quickly with minimum documentation. However, a high credit score can help borrowers in getting better interest rates against personal loans.
Understand How Unsecured Lending and Unsecured Personal Loans Work
Loans are usually secured or unsecured. Secured personal loans require collateral as a security against the loan. In case of non-payment of the loan by the borrower, the lender is free to dispose of the collateral to recover the funds.
Unsecured loans, on the other hand, do not require any collateral for the loan to be availed. Lenders will usually check the credit and employment history of the borrower to assess creditworthiness. If a borrower is found creditworthy, lenders will approve the unsecured loan.
Unsecured loan interest rates are higher as lenders face a higher risk owing to the absence of a collateral as compared to secured loans. In addition, all types of unsecured loans have lower loan amounts and shorter tenures as compared to secured personal loans.
Eligibility, Process and Benefits of Unsecured Loans
- No Collateral: One of the benefits of an unsecured loan is that it does not require the borrower to keep any asset as collateral or security at the time of availing the loan.
- Minimal Eligibility Criteria: To be eligible for an unsecured personal loan, the borrower has to be an Indian citizen, between the age of 20-65, employed in a private enterprise, and have a minimum monthly salary of INR 25,000.
- Easy Application Process: Applying for an unsecured loan is easy. Along with the loan application, borrowers have to attach their PAN card, Aadhar card, as well as 1 months’ salary slip or the bank statement of the salary account. On approval of the documents, the unsecured loan will be disbursed within a short time.
- Flexible Payment Solutions: Unsecured loans come with flexible repayment options. Borrowers can choose their repayment strategy based on their income and expenses.
How to Get Unsecured Personal Loans Online with Finnable?
Finnable offers various types of unsecured loans and applying for one is quick, simple and hassle-free.. You need to create your profile either on our App or website by filling in the required details. Next, you need to upload the documents required for KYC compliance. Following this, select the type of unsecured loan you require, the loan amount you need, and the repayment tenure. Click on ‘apply’ and that’s it.
You can get the funds disbursed within just 6 hours of loan approval.
Conclusion – You can avail of an unsecured personal loan to tide over a financial shortfall. We, at Finnable, offer personal loans for travel, weddings, home renovation as well as medical emergencies. We offer instant loans of up to INR 10 lakhs at attractive interest rates, with minimal documentation, and a loan tenure of up to 60 months.
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