Know The Maximum & Minimum Tenure For Personal Loans
The maximum and minimum tenor of personal loan is of 12 & 60 months respectively. Learn more about how to choose the right tenor as per your requirements.
Personal loans have become an ideal choice for individuals to cover any expenses without restrictions. However, the loan tenure affects the personal loan amount and resulting EMIs. Hence, it is essential to know the range of tenures offered by personal loans. This blog elaborates on the personal loan maximum tenure and personal loan minimum tenure.
What Are Personal Loans?Personal loans offered by NBFCs and banks allow individuals who need funds to cover necessary expenses or emergencies. Individuals take a personal loan when they have inadequate savings, are illiquid, or do not want to utilize the saved amount in a lump sum to pay for immediate personal expenses. Such expenses commonly include paying for marriage, education, home renovation, vacation, etc.
Borrowers prefer personal loans as they do not come with end-use restrictions. Like other types of loans, the borrower is legally liable to repay the principal loan amount with interest to the lender within the loan tenure.Here are some included factors of Personal loans:
• Loan Amount:It is the amount offered by the lender to the borrowers. It directly affects the interest rates as the higher the loan amount, the higher the interest rates.
• Interest Rate:The interest rate is a percentage charge levied over the loan amount, which the borrower has to pay to the lender over and above the principal loan amount.
• Loan Tenure:It is also the period within which the borrower has to repay the principal loan amount with interest to the lender.
The Maximum And Minimum Tenure For Personal LoansWith a higher loan tenure, the borrower has more time to repay the loan, resulting in lower EMIs and monthly financial obligations. Hence, if the borrower is looking to raise a high loan amount, which will come with a high-interest rate, an extended loan tenure can ensure lower EMIs for the borrower.
However, some borrowers prefer a lower personal loan tenure to ensure their financial liabilities do not stretch over an extended period. Hence, it is essential to know the personal loan maximum tenure and personal loan minimum tenure before taking a personal loan.
1. Personal Loan Maximum TenureThe maximum tenure for personal loans differs from lender to lender to ensure that the borrowers can choose as per their financial situation and goals. However, on average, the maximum tenure for personal loans goes up to 42 months, allowing borrowers to repay the loan through lower monthly EMIs. It is wise that an individual with a low monthly income chooses a longer personal loan tenure to assure no financial burden and timely repayment.
2. Personal Loan Minimum TenureLike the maximum tenure for personal loans, the minimum tenure also differs from lender to lender. Some lenders have set the minimum tenure for personal loans at 10-12 months. However, some reputed and experienced lenders offer three months as the minimum tenure for personal loans. Such short tenures are ideal for individuals with a high monthly income, as personal loans with short tenure come with high-interest rates, resulting in higher EMIs.
Factors To Consider While Choosing a Personal Loan TenureWhen you take a personal loan, the loan tenure directly affects the monthly EMIs and, as a result, your savings. Hence, you must choose an ideal tenure for your personal loan so that the loan product results in successful cost covering. Here are some things to consider while selecting a tenure for personal loans:
• Monthly Income:As you will have to pay the monthly EMIs from your income, it is wise to choose the tenure accordingly. You should select a short tenure if you have a high monthly income and a longer-term if your monthly income is low.
• Existing Liabilities:They also affect the in-hand monthly income, which you will have to use for paying EMIs on the personal loan. You should opt for the maximum personal loan period if you have substantial existing debts to cover.
• Interest Rates:If the interest rates on your personal loan are higher, you should opt for a longer loan tenure to stretch the repayment over an extended period. It will allow for lower EMIs and effective repayment.
Avail Of An Ideal Personal Loan With IIFL FinanceIIFL Finance is India’s leading financial service provider with over 25 years of expertise in offering financial services such as customised personal loan products. IIFL Finance personal loan product offers a minimum tenure of three months and a maximum tenure of 42 months to allow for effective repayment based on the borrower's monthly income. You can raise immediate capital of up to Rs 5 lakh, approved within 5 minutes and disbursed within 30 minutes of approval.
Q.1: What are the minimum and maximum tenures for IIFL Finance personal loans?
Ans: The minimum tenure is three months, and the maximum is 42 months for IIFL Finance personal loans.
Q.2: What are the interest rates for IIFL Finance personal loans?
Ans: The interest rates for IIFL Finance personal loans start from 6.48% per annum.
Q.3: How much CIBIL score is needed to avail of a personal loan with IIFL Finance?
Ans: You need a CIBIL score of 750 or higher out of 900 to avail of a personal loan with IIFL Finance.