Get Personal Loans up to 2 Lakhs in 6 minutes
Financial planning for major life events, such as comprehensive home renovations, consolidating substantial high-interest debts, or funding significant education or marriage expenses, often requires a large capital outlay. Unlike a small instant loan for minor expenses, these major goals demand a higher loan amount and a repayment schedule that aligns comfortably with your long-term financial stability.
A Long-Term Personal Loan is a strategic solution, offering a substantial unsecured credit facility with a strategically extended repayment tenure, which can range from 6 months (1.5 years) up to 18 months (1.5 years) or more, depending on the lending institution. This structure systematically manages the principal and interest burden, making high-value borrowing financially accessible and less stressful on your monthly cash flow.
A long-term personal loan is an unsecured financial product characterized by an extended repayment period, typically exceeding 12 months and often extending up to 5 years (60 months) in standard NBFC practice in India. Because this loan does not require you to pledge any collateral, approval is based entirely on your financial health, including your high creditworthiness, stable income, and proven repayment capacity.
Choosing an extended repayment tenure transforms the borrower experience for high-value needs. It is designed to maximize financial flexibility and minimize monthly financial strain.
While the repayment tenure is long, the application process for a long-term personal loan can be instantly digital. Digital platforms ensure speed, transparency, and a smooth user experience.
The entire application, from checking eligibility to final disbursal, is handled online. You avoid mandatory branch visits and physical paperwork submission.
The process leverages e-KYC and digital submission of income proofs, significantly reducing the verification time for the required extensive documentation (like ITR, Bank Statements, and Salary Slips).
Digital lenders can offer highly competitive long term loan interest rates, especially for applicants with a strong credit score (750 or above).
Although the loan amount is high, applicants with excellent credit histories often experience faster processing and disbursal of funds, often within 24 hours.
Lenders conduct a thorough assessment of financial stability for a high-value, long-term commitment. Meeting these criteria is key to securing favorable terms.
| Criteria | Details |
|---|---|
| Age | Must be between 21 to 60 years at the time of loan maturity. |
| Employment Stability | Minimum 6 months to 1 year of continuous service with a stable company. |
| Minimum Income | Typically starts at ₹15,000 to ₹25,000 per month (Varies by city/lender). |
| Credit Score | A strong score, ideally 750 or above, is preferred for the best interest rates. |
| Debt-to-Income (DTI) Ratio | Total EMIs should ideally not exceed 30% to 40% of monthly net income. |
A high-value, long-term loan requires comprehensive proof of identity, residency, and, most importantly, financial stability.
| Document Type | Salaried Applicants |
|---|---|
| Identity & Address Proof | PAN Card (Mandatory), Aadhaar Card, Passport, Voter ID. |
| Income Proof | Latest 3 to 6 months’ salary slips, Bank Account Statements (last 6 months), Form 16/Latest ITR. |
| Employment/Business Proof | Employee ID card or HR letter. |
The core benefit of a long-term loan is the reduced EMI, which is calculated using the principal, the interest rate, and the extended tenure.
An online EMI calculator is essential for planning:
The calculator will instantly provide the fixed monthly EMI amount, allowing you to choose a maximum tenure for the most comfortable repayment.
Understanding how your lower EMI is calculated:
EMI = P × r × (1 + r)n / ((1 + r)n − 1)
Where:
Note: Due to the extended tenure (n), the overall interest paid will be higher than for a short-term loan, even though the monthly EMI is low. This trade-off is crucial to consider.
All regulated lenders are required to clearly and transparently outline all costs in the Key Fact Statement (KFS).
| Fees & Charges | Details and Key Note |
|---|---|
| Interest Rate (APR) | Rate is determined by your credit score and risk profile. A higher score (750+) secures a significantly lower and more competitive rate. |
| Processing Fee | A one-time charge, typically ranging from 2% to 6% of the sanctioned loan amount, plus applicable GST. This is deducted upfront. |
| Pre-closure/Prepayment Charges | Check the agreement. Many regulated NBFCs, in line with RBI directives, do not levy prepayment or foreclosure charges on individual floating-rate loans, but a minimum lock-in period may apply. |
| Penal Charges on Default | Levied only on the defaulted EMI amount if a payment is missed, promoting fair debt recovery practices. |
The flexibility of a personal loan means the funds can be used for any legitimate purpose. Long-term loans are best suited for strategic, high-value goals.
Combining multiple high-interest debts (like credit card outstanding balances) into a single, lower-interest EMI.
Financing large-scale renovation or repair projects that require a significant investment.
Funding higher education fees, overseas study, or the comprehensive costs associated with a wedding.
Covering substantial, unexpected medical expenses requiring a large and immediate capital outlay.
The digital application process is designed for maximum speed and convenience for eligible applicants.
Choosing the right financing is crucial. The long-term personal loan is positioned differently from both short-term loans and secured loans.
| Feature | Long-Term Personal Loan | Short-Term Personal Loan | Secured Loan |
|---|---|---|---|
| Repayment Tenure | Typically 12 months up to 60+ months (5 years). | Usually a few weeks up to 12 months. | Long, often 5 to 30 years (e.g., home loan). |
| EMI Amount | Lower and most manageable. | Higher, can strain the monthly budget. | Generally the lowest for comparable amounts. |
| Total Interest Paid | Higher overall due to the extended period. | Lower overall interest. | Lowest, as the lender’s risk is minimal. |
| Collateral | Not Required (Unsecured). | Not Required (Unsecured). | Required (e.g., property, gold). |
| Ideal Use | Large strategic goals (e.g., wedding, renovation, debt consolidation). | Urgent, small-scale needs (e.g., emergency cash flow). | Very large investments (e.g., home purchase). |
No, the ideal choice depends on your specific financial goal.
Your credit score (ideally 750 and above) is the most crucial factor for a long-term unsecured loan. A high score:
The maximum amount is based on your income stability, credit score, and repayment capacity. While the amount varies by lender, many institutions offer unsecured long-term loans up to ₹15 Lakhs or more for highly eligible borrowers.
Yes. Most regulated lenders allow for pre-closure (foreclosure) or advance payments. Pre-closure is beneficial as it reduces the overall interest you pay. Always check your specific loan agreement for any applicable pre-closure fees and the minimum lock-in period that must be completed before you can close the loan.
This page is provided for informational purposes regarding unsecured personal loans, specifically the long term personal loans.
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