T.Y.BBI PERSONAL LOAN INTRODUCTION A loan is a redistribution of financial assets over a time between the lender and the giver of the loan. The borrower initially receives an amount of money from the lender, which they pay back usually but not always in regular installments to the lender. This service is generally provided at a cost, discounted as interest on the debt, to the lender. Acting as a principal of loans is one of the principal task for financial institution for banks. Loans are generally funded by deposits for other institution issuing of debt contract, such as bonds is a typical form of funding. Due to rising of basic needs, personal loan facilitated by various bank play a vital role in 1
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T.Y.BBI PERSONAL LOAN
INTRODUCTION
A loan is a redistribution of financial assets over a time between the
lender and the giver of the loan. The borrower initially receives an
amount of money from the lender, which they pay back usually but not
always in regular installments to the lender. This service is generally
provided at a cost, discounted as interest on the debt, to the lender.
Acting as a principal of loans is one of the principal task for financial
institution for banks. Loans are generally funded by deposits for other
institution issuing of debt contract, such as bonds is a typical form of
funding.
Due to rising of basic needs, personal loan facilitated by various bank
play a vital role in fulfilling the people desire of buying their dreams.
They are ideal when we need or buy a product for ideal when do not have
ready cash.
Personal loan are better choice compared with consumer durable loans. In
fact before we consider taking a consumer durable loan we might
consider a personal loan instead as the procedure is slightly longer but the
rate of interest is lower. Flexibility of duration and availability of various
loan for an amount up to Rs 15lakhs at attractive interest rates, with an
ICICI Bank personal loan.
With ICICI Bank personal loan you can get instant money for a wide
range of your personal needs like:-
1. Renovation of your house
2. A holiday with your family
3. Your child’s education
4. Buying a laptop or a electronic equipments
5. Medical expenses or any other emergencies.
The best personal loan cant’s get easier than an ICICI Bank personal
loan. To secure a instant personal loan all you need is one of the
following:-
1. A salary slip
2. Your credit card statement
3. Repayment track of an existing loan.
For instant, at ICICI Bank, your net salary needs to be 96,000 annually or
you need to have a net after tax of Rs 60,000 per annum. If you are a
salaried individual you should have worked in your current organization
for at least 1 year and if you are self-employed then you must have been
running your business for at least 3 years. You must have also been in
your current residence for at least a year.
The loan is sanctioned within 3 working days. The processing fee is
generally around 2% of the loan amount and is deducted up front the
disbursement amount. Most bank charge pre-payment penalty of between
3% to 5% of the remaining amount.
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Objective
1. The various personal loan provides by ICICI Bank aims at
provides financial support from the banking and financial system
to the needy people for taking personal loan in India.
2. The main emphasis is that the needy people should be provided
with an opportunity to take personal loan with financial support
from the banking system with affordable terms and condition.
3. To make people aware to take advantages of the various types of
personal loan provided by various bank.
4. To provide easy finance to the people.
FEATURES
1. Personal loan with a peace of mind: - ICICI bank personal loan
provide a free life insurance cover (including total and permanent
disability due to accident or sickness) to the value of the loan
outstanding. The insurance cover is for outstanding balance of the
personal loan as on date of death or total and permanent disability
due to accident or sickness, will be covered excluding any
defaulted installment.
2. A loan for every one: - loans for both salaried and self-employed
personnel with freedom to jointly apply with your spouse.
3. Quick and hassle free loan: - quick processing time of 24 hours
with hassle free documentation. No security or personal guarantors
required.
4. Get more from your loan: - we offer attractive interest rate with
loan from Rs 10,000lac to Rs 1,00,000 lac or to 10 times to the net
remuneration whichever is lower.
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5. Flexible repayment option: - you have flexibility to Choose the
repayment period of upto 5 years (60 installments) and we also
allow early settlement at a nominal fee.
6. Loan ranging from Rs 20,000 to Rs 15 lac
Eligibility Terms for your Personal Loan
You can avail of an ICICI Bank Personal Loan if you meet the following criteria:
Criteria Salaried Self - Employed
Age 25 yrs. - 58 yrs. 25 yrs. - 65 yrs.
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Net Salary Net annual
income - Rs.
96,000 p.a
Net Profit after tax
- Rs. 60,000 p.a
Eligibility Employees of
Public Ltd. cos.
Private Ltd. cos.
MNC’s Or
Government.
Doctors, MBA's,
Architects, CA's,
Engineers, Traders
& Manufacturers
Years in
current job /
profession
1 Year 3 Years
Years in
current
residence
1 Year 1 Year
Documents
Documents
( Pre Sanction)
SalariedSelf
Employed
Latest 3 months Bank
Statement (where
Yes Yes
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salary/income is credited)
3 Latest salary slips Yes
Last 2 years ITR with
computation of income /
Certified Financials
Yes
Proof of Turnover (Latest
Sales / Service tax returns)
Yes
Proof of Continuity current
job (Form 16 / Company
appointment letter )
Yes
Proof of Continuity current
profession (IT Returns /
Certificate of business
continuity issued by the bank)
Yes
Proof of Identity (any
one)Passport / Driving
License / Voters ID / PAN
card / Photo Credit Card /
Employee ID card
Yes Yes
Proof of Residence (any one)
Ration Card / Utility bill / LIC
Policy Receipt
Yes Yes
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Proof of Office (any one)
Lease deed / Utility bill /
Municipal Tax receipt / title
deed
Yes
Proof of Qualification Highest
Degree (for Professionals /
Govt employees
Yes Yes
Service Charges for your Personal Loan
Enclosed find the service charges for an ICICI Bank
Personal Loan
Prepayment of the loan is possible after 180 days of
availing the loan.
Foreclosure charges as applicable would be levied on the
outstanding loan.
Part pre-payment is not allowed.
No other fees or commitment charges are levied.
Description of
charges
Personal Loans
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T.Y.BBI PERSONAL LOAN
Loan Processing
Charges /
Origination
Charges
2* % of loan amount +
Origination Charges of 1%
of loan amount
Prepayment
Charges
5% on the principal
outstanding
Charges for late
payment (loans)
2% per month
Cheque Swap
Charges
Rs. 500/-
Cheque bounce
charges
Rs. 200/-
Note:
1) Origination Charges are included in the Advance installments/ First
installment.
2) Service Tax and other govt. taxes, levies, etc.
Application Process
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Key Benefits
1. Small business loan with no mortgage and no security required
2. The loan is provided in the form of overdraft, letter of credit or bank
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Information
Documents
Processing application
Application to bank
Disbursement of loan
Loan agreement
Sanctioning of loan
Repayment
Verification
T.Y.BBI PERSONAL LOAN
guarantee and you can borrow upto a maximum of Rs. 25 lacs.
3. Faster sanction.
4. Flexible payment scheduled- Part payment or Pre payment.
5. One stop solution with a bouquet of products.
Security
Personal loans are very flexible. They do not required collateral securities or
assets banking. They are disbursed based purely on the financial of the loan
applicant. Additionally your spouse income can be considered in calculating
the loan amount provided he/she guarantees the loan or the loan is taken
jointly.
Loan Repayment
Personal loan are repaid in the of Equated monthly installments. EMI are
calculated based on the loan amount, the rate of interest and the tenure of the
loan. “Banks calculate interest using the reducing balance method. The actual
interest is calculated on a daily reducing balance”
Transferability
If your lender is charging a high rate on your loan and you are able to find
another bank willing to lend at lower rate, you can transfer loan to the new
bank and thereby reduce the cost of your loan.
Advantages and disadvantages of different loan programs
Loan Program Advantages Disadvantages
Fixed-rate mortgages Predictable monthly payments
Less risk if market conditions
You pay more in interest
Higher interest rate
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cause rates to rise
Rate does not change
Unable to take
advantage of lower interest
costs if market changes to lower
rates
Adjustable rate
mortgages
Flexibility
Lower initial monthly payment
You pay less for short term
ownership
May be easier to qualify for
higher loan amounts
More risk
Inability to predict future
housing costs
Potential higher
payments (at max. interest rate)
Stated income
mortgages
Don't need to verify income Higher rates
Need a low LTV to
qualify
Combination loans
(such as an 80/10/10)
Avoid PMI
Potential tax advantages
Possibly higher monthly
payments
Two monthly payments
instead of one
Combination loans
(such as an 80/10/10)
Avoid PMI
Potential tax advantages
Possibly higher monthly
payments
Two monthly payments
instead of one
Home equity line of
credit
Flexible access to funds
Potential tax advantages
You only draw what you need
You only pay interest on what
you borrow
Ties up equity making it
unavailable for other needs
Higher interest rate than
a first mortgage
Home equity loan Predictable fixed payments
Possible tax advantages
Ties up equity making it
unavailable for other needs
Higher interest rate than
a first mortgage Cannot pay
down and withdraw additional
funds
Types of Personal Loans
On the basis of mode of repayment, personal loans are of three types - installment loans, balloon loans and single
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payment loans. Installments loans are repaid in the form of monthly installments. The monthly installments carry both the principal and the interest elements of a loan amount. In case of balloon loans, interest is paid at regular intervals and the principal amount is repaid at the end of the loan period. In case of single payment loans, the entire principal as well as its interest is paid at the end of the loan period.
Installment Loans: Installment loans are paid in regular amounts on a schedule, usually monthly, until the loan amount is repaid. There are no closing fees associated with installment loans.
Single Payment Loans: In this loan, the entire amount of the loan is due at the end of the loan period. This is probably the most familiar kind of loan to most people, where the entire sum of the loan is paid back at once, only with interest.
Balloon Loan: Similar to single-payment loans, balloon loans sometimes allow more than one payment, but generally have most of the amount due at the end of the loan period.
On the basis of mode of repayment, personal loans are of three types - installment loans, balloon loans and single payment loans. Installments loans are repaid in the form of monthly installments. The monthly installments carry both the principal and the interest elements of a loan amount. In case of balloon loans, interest is paid at regular intervals and the principal amount is repaid at the end of the loan period. In case of single payment loans, the entire principal as well as its interest is paid at the end of the loan period.
2. Form 16 (declaration from employer giving details of income and
deduction, duly signed by an authorised signatory of the company.
3. Latest acknowledged IT returns and
4. Bank statement for the last three months
For self-employed individual
1. Computation of income for last two year certified by a CA.
2. P/L and balance sheet for the last two years certified by a CA.
3. Copy of acknowledged IT returns for the last two year.
4. Bank statement for the last six months.
Photo identity (anyone)
1. Passport
2. Photo pan card
3. Defense identity card
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4. Voters identity card
5. Driving license
6. Photo ration card
7. Government identity card.
Proof of residence (anyone)
1. Passport
2. Ration card
3. Telephone bill
4. Electricity bill
5. Driving license
6. Society out going bill
7. Voter ID
8. Life insurance policy
Note :
Only passport can be used as both proof of individual identity and proof of
residence address
Proof of age (anyone)
1. Passport
2. Driving license
3. Voter ID
4. School living certificate
5. Photo ration card
4 easy ways to repay personal loan
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1. lower EMI in the first year You can start by repaying an amount you can afford today. After a year, you can pay a higher EMI.
2. Interest on utilise loan amount only , not on the entire loan Simply estimate the maximum loan amount you need. You can
withdraw money as when you need and interest will be charge only on the amount you withdraw.
3. Last EMI waiver This repayment option gives you the benefit of getting a last EMI
refunded by paying a marginally higher interest rate (available for loan of 48 months tenor only an applicable if you repayment is consistent throughout the period of the loan.
4. Standard EMI repayment Your EMI for each month will be the same for the tenor of the loan.
Survey Report
I have done a customer survey from 1st Aug., to 31st Aug., 2007 about personal loan provided by the banks in that survey I have asked a few questions to the people and I have got following results:
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T.Y.BBI PERSONAL LOAN
Are you aware of the personal loan?
Do you plan to pursue personal loan in future?
Which bank would you like to prefer for pursuing personal loan?
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What type of interest rate would you prefer?
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How much importance has the personal loan assume?
Do you think the procedure for personal loan is_
Frequently asked question
1. What are the minimum and maximum loan amounts?
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You can avail of loans ranging from Rs 20,000/- to Rs 15,00,000/- depending on your eligibility, income and repayment capacity.
2. What are the loan tenure options?
The loan can be repaid over a period of 12 to 60 months.
3. Are there any additional charges?
A processing fee of 2% of the loan amount is payable upfront. This fee will be deducted from the disbursal amount payable to you.
4. How much time will it take for my loan to be approved?
Loans are approved within 72 hours of submission of complete documentation.
5. Do I have to provide any security, collateral or guarantors?
No security, collateral or guarantors are required for obtaining a Personal Loan.
6. How do I repay the loan?
You can repay the loan in Equated Monthly Instalments (EMI's) through post-dated cheques favoring ICICI Bank Limited, or if you have an ICICI Bank account you can mandate us to directly debit the same.
7.Can I prepay my loan?
Yes, you can prepay the entire loan outstanding anytime after 180 days of availing the same. Prepayment charges as applicable would be levied on the outstanding loan amount. No part prepayment is allowed.
8. Do I need to open an account with ICICI Bank for
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availing and/or servicing the loan?
We will encourage you to start a banking relationship with us so that we will be able to offer a host of other value added services, which are complementary to the loan, however opening an account with us is not mandatory.
9. How do I approach ICICI Bank for a Personal Loan?
You can approach us in any of the following ways
24 hour Customer Care Centre Apply Online [email protected] You can just walk into any of any branches.