What is the Processing Fees & Charges for Personal Loan?
In today’s time, the best way to solve the problem of cash crunch is to take a personal loan. You can get an Instant Personal loan in no time from loan apps like Zype.
The four important factors to consider while borrowing money are loan amount, interest rate, personal loan repayment tenure and processing fee.
In this blog, we will discuss everything you need to know about the processing fee for personal loan – its meaning, types of charges and hidden charges that you need to be careful of.
Table of Contents
ToggleProcessing Charges for Personal Loan
A processing fee is charged to cover the administrative cost incurred by the lender while processing your loan. If you want to check the processing charges for personal loans and interest rates offered to you by Zype, complete the loan application process to generate your credit line offer.
Loan Amount | ₹3,000 to ₹5,00,000 |
Interest Rate | Starting at 1.5% (monthly) |
Loan Processing Charges | Processing fees from 2% to 6% on every loan |
Penalty on Overdue EMIs | Overdue interest and late payment penalty charge will be charged to your total outstanding loan on a daily basis |
Loan Tenure | 6-12 months |
Types of Charges
Personal loan Interest Rates
Interest rate is one of the most important factors that you should consider while choosing a lender. It determines the cost of your loan. Interest rates on Zype loan app start at 1.5% per month.
Loan Processing Fee
A processing fee is a small amount charged by loan providers to cover administrative costs. Zype charges an affordable processing fee of 2-6% of the loan amount.
Penalty Charges
This includes overdue interest and late payment penalty charges and late fees levied by a lender when a borrower fails to pay EMI on the due date.
Interest on Overdue EMIs
Before getting a loan, check the interest charged by the lender on overdue EMIs in case you are not able to pay on time.
Foreclosure Charges
The loan provider might levy a charge if you want to pay off the loan before your due date. Zype does not charge any foreclosure charges.
Also Read : Consequences of missing your EMIs
Charges to Check Before Getting a Loan
It’s a good habit to read the loan agreement to check for all the charges that could be levied on you. Before you finalise the loan, make sure to get clarity on these charges.
1. Prepayment Charges
Check how much you would be charged if you decide to make a complete or partial payment of your loan amount before the end of the loan tenure.
2. Late Payment Fees
Check the penalty amount you would need to pay if you are unable to pay your EMIs on time.
3. Flat Rate or Reducing Rate of interest
If you’re charged a flat rate of interest, the interest is charged on the principal amount for your entire loan tenure. This means that you will pay interest on the full loan amount until your last instalment.
Whereas in reducing rate, you only pay interest on the outstanding loan amount. Here, your interest expense reduces with each instalment.
Also Read: Know the Maximum and Minimum Tenure for Personal Loan
Conclusion
You should always take a personal loan from a reputable loan provider and read the loan terms carefully before availing the loan.
If you want to get affordable instant personal loans up to ₹5,00,000 without any hidden charges and affordable processing fees, download the Zype app. You can complete the loan application in less than 6 minutes and your loan offer will be generated in less than 60 seconds. You can take as many loans as you want from your active loan limit and pay later in convenient 6, 9 and 12 EMIs.
Frequently Asked Question
What is the Rate Of Interest Charged On A Personal Loan?
Different loan providers charge different interest rates as per their credit policies. Interest rates on Zype personal loans start at 1.5% per month.
Is the processing fee for a personal loan refundable if my loan application is rejected?
If your loan application is rejected, you should not be charged any processing fee for a personal loan. A genuine lender would never charge a processing fee if your loan application is rejected.
What are the hidden fees one needs to be careful of when taking a loan?
You should only pay interest costs and processing charges for personal loans. Apart from these charges, reputed lenders usually don’t levy any other fee while giving an online personal loan.
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