Loan options for non salaried individuals when a personal loan denied
In the last few years, there have been new trends in the job market, such as switching jobs often and working as a freelancer.
But from the lender’s point of view, having an irregular income makes it harder for you to pay back your loan on time. Also, banks and non-banking financial companies (NBFCs) have strict rules and regulations that make it hard for most people with unstable incomes to get loans, especially unsecured ones like a personal loan.
So let’s look at loan options for the non-salaried segment of customers who want a loan on aadhar card.
Gold-backed loans
If you don’t have insurance to pledge for Loan Against LIC but have gold, then use it! Gold loans have been a common asset, especially in India, where a large portion of the population keeps gold as an emergency reserve. So the gold loan is a great way to utilise that asset in case of money needs. Because the loan amount is usually based on the value of the gold and less on the borrower’s ability to pay back the loan, it is often used to help people who need money but can’t get a personal loan for self-employed or are turned down for one. People with irregular income who haven’t been able to get other loans, like personal loans or Loan Against LIC, can easily get a gold loan. They are given out right away and require little in the way of paperwork and eligibility criteria. So, gold loans are a great way for freelancers, consultants, and other professionals who don’t have a steady source of income to get money.
Keep in mind that even though gold loans are given out quickly, they usually only last for a short time, usually no more than three years of tenure. When you get a gold loan, make sure you have enough money in savings or investments to pay off the loan’s monthly payments on time. If you don’t do this, the lender will take the gold you put up as collateral in order to get their money back. And if you don’t have enough gold to get a loan, you can try other options like a loan on aadhar card.
Loan against properties
For both business and personal loans, residential, industrial, and some commercial properties can be used as collateral. You can get a loan against your property for both business and personal reasons. How much money is given out as a loan is a percentage of how much the property is worth? The loan to value ratio given by the lender shows how much money is given out. Loans against property are secured loans, so the interest rates are usually not too high, and the length of the loan can be up to 15 to 20 years. Since they are secured loans, people with irregular income who own property can apply for them. This is especially true if they have been turned down for a loan on aadhar card.
Remember that the loan amount a borrower gets depends on the type of property, the customer’s credit history, the lender’s LTV, and other things. Most loans backed by real estate are for large amounts of money, so it’s important to pay back the loan on time. If not, the lender could take the property that was used as collateral and sell it to get their money back.
Also, if you need a smaller loan amount and don’t want to put up a property as collateral, you can get a cash loan to meet your smaller financial needs.
Loan against securities
These loans are backed by your securities, such as stocks, insurance like Loan Against LIC, etc., and give you cash without letting you lose ownership of the securities you put up as collateral. All lenders give a full list of the securities that can be used to back a loan that is backed by approved securities. In this group of securities, you can find things like Demat shares, mutual fund units, term deposits, listed bonds, insurance policies, and provident funds, among other things.
The amount you can borrow is based on the value of the collateral you put up. The borrower can take money out of this account and can also pay it back by putting money back into the account. In general, Loan Against LIC is cheaper than personal loans like cash advances and credit cards, which have higher interest rates because interest is only charged on the amount that is still owed at the end of the month.
Use a credit card to get a loan.
Suppose you don’t have access to a loan on aadhar card or insurance to pledge for taking Loan Against LIC. There is another, lesser-known way to get the money you need if you have a credit card. It’s a loan from a credit card.
Loans against credit cards are loans that have already been approved. Depending on your credit score, the bank will lend you up to a certain percentage of your credit card limit. Since they have already been approved, they usually require less paperwork because the lender already knows your profile from how you use your credit cards. These could be a good way to get credit if you were turned down for a personal loan for the self-employed.
Depending on the type of credit card and the customer’s profile, the interest rate may be slightly higher than that paid on personal loans. How much of the borrower’s credit card limit has been used up determines how much money they can borrow. On the other hand, some lenders may be willing to give you a loan that is more than your credit limit if they are sure you will be able to pay it back.
Summing it up
So now you must be fairly clear about loan options to take as a non salaried individual. Besides businessmen or professionals like lawyers or doctors, there are freelancers nowadays who are increasing in number. So such people should be aware of loan options where they stand a higher chance of approval, especially if denied a personal loan.