The Six Best Types of Loans you can Opt for during Hard Times

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During the pandemic and the global lockdown it has resulted in, problems are cropping up like manholes in a badly-damaged road. People are grappling with salary cuts, layoffs and job loss. Unemployment and loss of savings is a big concern for most people right now. With salaries getting halved and with jobs lost, expenses are rising to staggering proportions. During such times, people naturally see loans as a good way out. However, there’s a big problem that way as well in these tough times.

Banks and other lenders do not wish to give out new loans right now. It is too risky for them. Thus, they are acting conservatively right now, and targeting only a limited segment of the population as their preferred customer segment. However, if you are in need of an emergency fund, help is at hand.

Loan against property

These loans are sanctioned against collaterals of residential, commercial and interest property. The interest rates of LAP starts from 8.95% on an average. But it does depend on the lender, the amount of loan, the lender’s credit profile and other things. The maximum tenure is 20 years. Amount of loan depends on property valuation and the borrower’s repayment capacity.

Gold Loan

Bank’s may not want to give traditional loans like personal loans right now, but they are very eager to give gold loans. Why? That’s because gold loans are secured loans. You can get gold loans within a few hours after you apply. The amount you get as a loan can be 75% of the gold value and the interest rate starts from 9%.

Digital top-up home loans

If you have existing home loans, you can choose digital top-up loans. These do not have any end use restriction. Another good thing is that interest rates are quite lower than other loan alternatives which you can get as an existing home loan customer. These are, additionally, available for a longer tenure depending on the tenure of residual loan of the borrower.

Loan against credit card

If you do have a credit card already, you can get pre-approved loans depending on the card type, repayments and spending pattern. When you take the loan, the credit limit will go down. 

Covid-19 personal loans

Some banks are offering personal loans specifically for the Covid-19 situation. However, these are only for their existing customers only, those who have their salary accounts with it or have home loans or personal loans. They also need to have a strong repayment history. These loans have lower interest rates and do not have any processing fees either. While most loans have 3 year tenures, some banks do give 5 year tenures. Additionally, banks give a moratorium till 3 to 6 months, though customers need to pay the interest during the moratorium.

Pre-approved personal loans

Most, if not all, banks offer pre-approved personal loans to a few customers only, especially those who have been their customers for a long time. For such customers, loans are given fast, and there are no collateral requirements either.

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