What Is a Long-Term Loan?

From a considerable medical bill to a chance to study abroad situations where you need significant funding can arise anytime. In these cases, opting for a long-term personal loan can be the best option. These loans generally have a maximum tenure of 5 years, with some lenders providing even longer tenures. By choosing the option for the longest tenure for the personal loan, you can repay the borrowed amount over an extended period to ease repayment. 

Long-term loans are suitable for individuals looking to finance significant expenses, such as buying a house or debt consolidation solutions. Long-term financing options make it more manageable to meet your financial needs without worrying about immediate lump sum payments. 

Long-term personal loans also offer the flexibility to choose a repayment schedule that aligns with your financial situation. Many lenders also offer the option of prepayment, including a certain charge, if you wish to close your loan early.

Features and Benefits of a Long-Term Personal Loan

Long-term personal loans offer a range of features and benefits that make them an attractive option for those seeking financial assistance over a longer period of time.

Personal Loan Amounts up to INR 30 Lakhs*

Long-term instalment loans offer large loan sums, typically up to INR 30 lakhs*. Borrowers can select the specific amount they require, ranging from INR 50,000 to INR 30,00,000*, enabling them to borrow the necessary funds to address their financial needs without accumulating excessive debt.

Flexible Repayment Periods

You can modify the repayment period according to your financial situation, as these loans offer flexible tenures from 12 to 60 months. This extended tenure personal loan option lets you choose a repayment duration that aligns with your financial circumstances. Spreading repayments over a longer period facilitates more effective budget management.

Competitive Interest Rates

The interest rates for long-duration personal loans are generally competitive, depending on your eligibility and creditworthiness. This makes borrowing more cost-effective and helps decrease the total loan expense. Knowing the possible interest rates beforehand allows you to manage your finances more effectively. You can use resources such as a personal loan EMI calculator to estimate monthly payments and budget according to your existing financial obligations.

Quick Fund Disbursal

Once approved, funds from a long-term personal loan can be disbursed quickly. For smaller loan amounts up to INR 2.5 lakhs, disbursal to your account can happen as quickly as 30 minutes*. This rapid availability of funds makes long-term personal loans ideal for urgent financial needs.

Transparency and No Hidden Charges

Long-term financing options from reputable lending institutions such as SMFG India Credit are transparent, with no hidden charges. Borrowers are informed of all costs upfront, ensuring no surprises during the repayment period. 

Thus, long-term personal loans offer higher loan amounts, flexible repayment terms, competitive interest rates, quick fund disbursal, transparency, and no collateral requirements. These features make them a viable option for substantial financial needs.

Advantages of a Long-Term Personal Loan

Long-term personal loans have several advantages. Some of them are:

• Easier to manage: They usually come with lower monthly payments, which makes them easier for borrowers to manage. 
• Better budgeting: The extended repayment period allows for better financial planning and budgeting. 
• Improve your credit score: Consistently repaying long-term loans can also improve your credit scores, providing a reliable way to handle significant expenses without immediate financial strain.

Eligibility Criteria for a Long-Term Personal Loan

Eligibility criteria differ between lenders. Typically, applicants must be between the ages of 22 and 65 and be citizens of India (25-65 for self-employed individuals). They must be working in the public sector, a registered private company, or be self-employed. Salaried individuals must earn a minimum monthly income of INR 25,000 in Delhi/Mumbai and INR 20,000 in other regions. For self-employed applicants, eligibility is based on their annual profit and profession. Applicants must have a credit score of 750 and above to be eligible for an extended tenure personal loan. 

You can check the detailed eligibility criteria for SMFG India Credit here. 

Documents Required for a Long-Term Personal Loan

Various types of documents are required for a long-term personal loan. A basic list is given below: 

• Income Proof: These include bank statements for the last six months, salary slips, and Form 16 for salaried individuals. IT assessment, TDS certificate, balance sheet, and P&L account are required for self-employed individuals. 
• Address Proof: This includes your Aadhaar Card, Voter ID, Ration Card, Electricity Bill, Passport Copy, etc.  
• Identity Proof: This will include your PAN Card, Aadhaar card, your Voter ID, Driver’s License, etc. 

You can check the complete list of the required documents for SMFG India Credit here. 

Fees and Charges for a Long-Term Personal Loan

In addition to interest rates, some charges apply to a long-term personal loan, like processing fees. Processing fees for long-term loans is up to 5% of the total loan amount + GST. Other charges, like swap and cancellation, can also affect the overall loan cost. 

You can check the complete list of fees and charges for SMFG India Credit here. 

Conclusion

Long-term personal loans can make monthly payments more manageable with reduced EMIs, making it ideal for significant financial needs. With competitive interest rates and quick fund disbursal, it offers substantial benefits. SMFG India Credit offers personal loans up to INR 30 lakhs* starting at just 13%* per annum. Our repayment tenure starts at 1 year, with the longest tenure for personal loans going up to 5 years. Apply online or contact us to know more.