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Tata Capital Personal Loan

The demand for a personal loan has been going up in recent past due to the availability of more and more consumer and electronic products. The trend of travelling abroad has also added to growth in the personal loan market.
Banks, as well as Non-Banking Finance Companies, are equally active in this segment. Tata Capital is a major player here.

Various types of personal loans provided by Tata Capital

The Tata Capital provides personal loan for various purposes ranging from a loan for a wedding to loan for going on holidays, to meeting the medical emergency. Tata capital has innovated in the personal loan category by introducing various novel features like a step up and step down and joint wedding personal loans.

Under the step up personal loans, the amount of repayment is lower initially and goes up gradually. Under the step down personal loan, the amount to be serviced monthly is higher initially and goes down gradually.
Under joint wedding loan, the couple getting married can jointly apply for the 50-50 wedding loan up to Rs. 5 lakhs repayable over 24 to 36 months.

Basic features of Tata Capital Personal Loan

The repayment tenure for Tata Capital personal loan is 12 months to 48 months but for self-employed and for Tata Capital offers personal loan for an extended period of 72 months. The extended period helps you get a loan of the higher amount at the same level of income. Alternatively, with extended repayment tenure, you get the lower Equated Monthly Instalments (EMI) for the same amount of personal loan.

Rate of interest on personal loans

The rate of interest charged on personal loan generally are higher than other loans as personal loans are given without collateral security or guarantee. The rate of interest for personal loans given by Tata Capital varies between 11.49% to 19% depending on the profile of the borrower. The salaried people working for reputed companies are generally offered lower rates as compared to people engaged in the business.

The rate of interest varies also depending on your credit history and credit score. Higher the credit score lower is the rate of interest offered. The interest on a personal loan is calculated on the reducing balance method meaning that interest is charged only on the amount outstanding. The personal loans are generally given on fixed rate of interest and therefore the amount of EMI is also fixed at the time of disbursement of the personal loan.

Eligibility criteria

The Tata Capital personal loans are given for a minimum amount of Rs. 75,000/- to a maximum amount of Rs. 15 lakhs to the people who are in the age group of 21 to 58 years and are salaried. For a salaried person to be eligible for the personal loan from Tata capital the applicant should have a minimum salary of Rs. 20,000. He should also be in the same job for minimum 6 months and with a minimum of two years of work experience.

The self-employed can get a personal loan if they are between the age group of 25 to 65 years for an amount up to 20 lakhs. The minimum continuity in the business for self-employed is higher at three years.

The amount of personal loan eligibility will depend on various factors like age of the borrower, a number of dependents in the family, nature of business or employment, any existing loan being serviced etc. The personal loan eligibility is calculated with reference to the ability to service the personal loan and which is, in turn, is determined on the basis of disposable income of the borrower.

The disposable income is dependent on the net take-home salary, a number of dependent in the family, any existing loan being serviced. The lenders generally, as a thump rule, consider around 40% to 45% of the net take-home salary as available to service any loan liability. And based on this amount and tenure opted/available the amount of personal loan available is determined. In case the amount for which one is eligible falls short of the amount required, it can be enhanced by adding an eligible person as co-borrower/co-applicant for the personal loan

Charges payable

For availing personal loan, one has to pay a certain percentage of the loan amount being applied to processing fee which is to be paid upfront and is not refundable generally. Like fee for the processing of the personal loan from Tata Capital, you also have to pay prepayment charges in case you want to prepay either the personal loan in full or in part before its initially fixed tenure.

The Tata Capital personal loan can only be repaid after completion of initial 12 months. The prepayment charges are levied on the amount of personal loan being repaid. The prepayment charges are generally higher when you want to repay the personal loan fully as compared to those applicable for part prepayment of the personal loan. Presently the maximum prepayment charges being levied by Tata Capital are 4%. However, no prepayment penalty is levied for repayment up to 25% of the loan amount within six months of the disbursement of the loan.

Document to be submitted for personal loans

For availing personal loans from Tata Capital applicant has to submit certain documents for identity and address. For establishing identity documents like Voter Card, PAN card, Aadhaar Card, Driving Licence, a copy of passport etc. are acceptable. For address proof applicant can submit any of the documents like ration card, electricity bill, telephone bill, driving licence, Aadhaar Card, passport etc. The applicant also has to submit banks statements for past three months with the personal loan application.

In addition to the identity and address proof, the borrower needs to establish his repayment capability with the help of documents to prove income. Income proof would differ from a salaried person to a self-employed person. For salaried persons, latest salary slips as well and form No. 16 for last two years are sufficient.

However, for a self-employed copy of the Income Tax Return for past two years along with copies of profit and loss account with Balance Sheets are required. Additionally, self-employed professionals have to submit the copy of the documents to establish their professional qualification as well as the membership of the professional body. The people engaged in business need to submit documents for registration under GST, shop and establishment etc.