How to Apply for an Instant Loan?

16 June 2022
5 min read

In today’s world, we may come across instances of unexpected expenses. Opting for an instant personal loan is an easy way to tide over this crisis. This form of financial assistance does not involve any collateral but comes with high-interest rates and fees. 

To know how to apply for instant loans, read on!

What are quick loans?

Quick loans is a form of credit that allows you to take a loan in a very short period of time with a minimum number of steps involved. Through this, the borrower can get instant money in their bank account at an interest rate that is competitive with the interest rates charged by other sources of loans.

Quick loans can be helpful in cases of urgent requirements of money such as student loans, making medical payments, some immediate purchases, and marriage-related costs.

However, people can also avail of these loans in cases when they require a one-time payment and wish to repay it back in EMIs such as in the case of going for a vacation, and buying a bike.

Reasons to take personal loan

  • Educational/professional expenses

At times you may have to purchase a laptop or have any exams coming up in your college that require an additional sizeable expense. Quick personal loans can help you with such expenses.

  • Medical Emergencies 

There might be moments when you have a medical emergency and you need urgent funds. Insurance policies may not cover all medical procedures. Some diseases and treatments that you might need are not covered by all insurance policies. 

An instant personal loan for a medical emergency is one of the ideal solutions in such situations. You can utilize the loan money to pay for any medical expenditures or therapies you might need.

  • Going On a Vacation 

Traveling to new places may often refresh the soul and help to break up the monotony of daily activities. Making regular savings towards such holiday goals, where one can aspire to build a healthy amount to pay the trip expenses, is always a financially wise decision. 

However, making advance reservations for such expenses, particularly flights and hotels, can help you save a significant amount of money, hence reducing your overall travel budget. To make such advance payments, one can take out an instant personal loan for travel and repay the loan with your savings at a later date. 

  • Clear Credit Card Debt 

Personal loans can be a great way of clearing high credit card debts since interest rates on personal loans are relatively lower, in the range of 3% to 30% when compared to credit card interest rates (12%-24%). 

Thus, you may consider taking out a low-interest personal loan to pay off your credit card debt. 

However, there are also risks involved. For instance, taking out a personal loan could lead to more debt. So, use it only if you have no other options, like opening a balance transfer credit card.

  • Improving Credit Score 

Personal loans might help you raise your credit score. However the important thing to note here is timely payment. Each time you successfully repay your debts, on time, you will see that your credit score will stabilize and improve over time.

  •  
  • Wedding Expenses 

Marriages are quite a big deal in India and people tend to splurge a lot on wedding festivities. 

Marriage expenses can sometimes run beyond budget due to a desire to celebrate in the most extravagant way possible. Instead of being financially stressed because of this, one can take out a personal loan to cover wedding costs and then repay the loan in monthly payments. However, being financially prudent at the time of any celebration is a wise habit. Taking a loan to celebrate may appear easy, but making timely repayment, particularly when your family expands may be difficult. 

Important Things to Know about Instant Loans

Here are some crucial things to know about instant loans before applying for this type of financial assistance:  

  • High credit score

A high credit score (preferably more than 750) will help borrowers to get fast approval. Individuals who maintain a high credit score will also get low-interest rates and favorable repayment terms.

  • Processing fee

Many institutions charge a processing fee while sanctioning a loan. Borrowers can check the charges before applying and take a decision accordingly. 

  • Compare interest rates of different financial institutions 

It is essential to compare the interest rates offered by multiple lenders. It will help borrowers make a more efficient decision that is in line with their repayment capacity.

  • Easy EMI repayments

Many platforms offer easy EMI repayments for instant loans – these allow the borrower to pay back the money in small amounts

  • Minimum paperwork

Unlike traditional bank loans, quick loans involve minimum or no paper requirements and can be availed from the comfort of your home.

  • Free early closure

Some platforms also offer free early closure of the loan i.e. you can repay the amount earlier than the time period you had initially selected, allowing you to not pay any further interest amounts.

Documents Required for Instant loans

Before applying for an Instant Loan, take a look at the list of documents to keep ready in hand. This set of documents may be required to be furnished and uploaded during the process of the Instant Loan application-

  • Proof of address (voter ID card, passport, utility bills, etc.)
  • Proof of identity (PAN card, Aadhaar Card, etc.)
  • Salary Slips of last 3-6 months (for salaried employees)
  • Income statement (for self-employed individuals)
  • Bank statements for the last 3-6 months.

Steps to Apply for an Instant Loan

To get an instant loan, one needs to apply by following the steps given below:

Step 1: Visit the website or mobile app of the lender.

Step 2: Go to the instant loans section.

Step 3: If you are an existing customer, fill out the application form. New users will have to complete the registration process and then fill out the application form.

Step 4: Fill in all the details and complete mobile or e-mail OTP verification. 

Step 5: Fill in the income details and KYC data.

Step 6: Select the loan amount. 

Step 7: Upload the relevant documents.

Step 8: Submit the application form. 

Calculate your Personal Loan EMI here with Groww Personal Loan EMI Calculator

Final Word

An instant personal loan can be beneficial when someone is facing a cash crunch. Individuals opting for instant loans should compare the terms and conditions as well as facilities offered by various lenders before initiating the application procedure. 

Do you like this edition?
LEAVE A FEEDBACK
ⓒ 2016-2023 Groww. All rights reserved, Built with in India
MOST POPULAR ON GROWWVERSION - 3.7.0
STOCK MARKET INDICES:  S&P BSE SENSEX |  S&P BSE 100 |  NIFTY 100 |  NIFTY 50 |  NIFTY MIDCAP 100 |  NIFTY BANK |  NIFTY NEXT 50
MUTUAL FUNDS COMPANIES:  ICICI PRUDENTIAL |  HDFC |  NIPPON INDIA |  ADITYA BIRLA SUN LIFE |  SBI |  UTI |  FRANKLIN TEMPLETON |  KOTAK MAHINDRA |  IDFC |  DSP |  AXIS |  TATA |  L&T |  SUNDARAM |  PGIM |  INVESCO |  LIC |  JM FINANCIAL |  BARODA PIONEER |  CANARA ROBECO |  HSBC |  IDBI |  INDIABULLS |  MOTILAL OSWAL |  BNP PARIBAS |  MIRAE ASSET |  PRINCIPAL |  BOI AXA |  UNION KBC |  TAURUS |  EDELWEISS |  NAVI |  MAHINDRA |  QUANTUM |  PPFAS |  IIFL |  Quant |  SHRIRAM |  SAHARA |  ITI