A consumer durable loan is also a loan for those who want to buy home appliances. Such as furniture, washing machine, microwave, Led, AC, fridge, etc. You can use Consumer durable loans to bring necessary home items. You can set a time limit to repay the loan. You can take the loan at a zero percent interest rate or low-interest rate.
- Consumer Durable Loan Features
- Consumer Durable loans offered by Top Banks and NBFC
- Eligibility Criteria for Durable Consumer Products Loans
- Types of Consumer Durable Loans
- Fee& Charges of Consumer Durable Loan
- Required Documents for Consumer Durable Loans:
- Factors Affecting Consumer Durable Loan Interest Rate
Consumer Durable Loan Features
- Interest Rate: zero percent via most of Creditor
- Bank and NBFC provide EMI without extra cost.
- Loan funds start from INR 10000 to INR 15 lac.
- Returning amount and time duration decides by the bank while giving a loan.
- 100 percent financing: for consumer durable items
- Loan Type: Secured and unsecured
- Forecloser charge: Zero
- Hassle-free documents
Consumer Durable loans offered by Top Banks and NBFC
|Bank||Description for Consumer Durable Loan|
|State Bank of India||No EMI Cost via some brand for the loan funds up to 1lac|
|HDFC Bank||100 percent financing on consumer durable items with low or 0 interest rate for buying|
|Tata Capital||No EMI Cost|
|Bajaj Finserv||100% funding On low or zero interest rate for purchasing consumer durable products|
|IDFC First||Zero EMI Cost with loan funds from 25 thousand up to 5 lac|
|Indusind Bank||Zero EMI Cost offered by the Bank|
|Fullerton India||Easy EMI Loans funds Range from INR 11,000 up to INR 30,000|
Eligibility Criteria for Durable Consumer Products Loans
For salaried and self-employed, consumer durable loans are available from Most lenders (Banks and NBFCs). Consumer durable loans, eligibility is depending upon the applicant’s repayment history, income and loan fund, and some other details. For consumer durable loan fund, eligibility criteria by the creditor are below:
- Age limitation: Min 21 years and Max 65 years
- Minimum Monthly Income: Must Be INR 15,000
- Experience in current company: Min 1 year
- Age limitations: Min 21 years and max 68 years
- Minimum Income: INR 1.5 lac
- Employment Stability: Minimal 2 years in the present business
Types of Consumer Durable Loans
The fund taken to purchase household items is called consumer durable loans. Such as washing machines, led, microwaves, electronic gadgets, fridges, etc. A consumer durable loan is a kind of instalment loan. This kind of loan varies from EMI conversion using a debit card/ credit card as no car is required to buy or make an instalment payment plan.
Instalment of Consumer Durable Loan and Varied Subcategories
Instalment loan: Consumer durable loans have to pay back in weekly, monthly or bi-monthly instalments according to a present timetable. The interest rate on instalment could be stabled or change with time. Moreover, these types of loans may get without security. Following are various types of instalment loans with different features:
Fixed-rate consumer durable loan: Maximum consumer loans provided on fixed-rate, using the same mechanism used in other personal loans. As the name suggests, a fixed interest rate applies during the loan term.
Variable-rate consumer durable loan: The interest rate to be paid on the outstanding balance of variable-rate consumer durable credit differs with the change in the market interest rates. However, there are interest-rates limits in tenure and how high or low-interest rates on these types of loans can be.
Secured consumer durable loan: Secured loans are those kinds of loans backed by assets as collateral. Secured consumer loans in India are mostly concerned with the hypothecation of the bought product. Many banks also support secured consumer durable loans by assets such as FD, LIC Policy, Gold, etc. The interest rate on secured consumer durable loans is low. If the borrower cannot pay back the loan, then the creditor can sell the borrower’s assets to make up for their loss.
Unsecured Consumer Durable Loan: Unsecured consumer durable loans need not provide any assets as security for unsecured consumers. The borrower has to pay higher interest on unsecured loans compared to secured loans. But in the case of festivals, banks and NBFC offer a loan on lower or 0% interest rates.
Fee& Charges of Consumer Durable Loan
- Processing Fees: The processing fee basically differs range 0% to 6% loan approved.
- Late Payment Charges: Delay in paying loan instalment; the borrower has to pay late payment charges (basically fixed charge) and pending Instalment.
- Cheque bounce Charges: Fixed charges INR 500.
- Foreclosure/Prepayment Charges: Basically range from 0 % and 6% of the principle money prepaid plus related taxes
Required Documents for Consumer Durable Loans:
- Filled form with 2 passport-size photos
- Address Proof: Aadhaar Card/ PAN Card/ Passport/ Voter Card/ Bank Account Statement/ Driving License/Utilty Bill Assets documents.
- Identity Proof: Aadhaar card/ Voter Card/ Driving License/Passport/ PAN Card
- Income Proof:
Salaried Individuals: Salary Slip/ Bank Account Statement/Form 16
Self-Employment: Bank Account Statement/Past year income tax return (ITR)/P&L statement and balance sheet
- Any other documents requested by the bank
Factors Affecting Consumer Durable Loan Interest Rate
Though several Creditors provide consumer durable loans with a 0% interest rate, some charge interest. Financial institutions decide the interest rate and also depend upon the Applicant’s profile. Some factors impact the interest rate charged to Applicant:
- Credit Score: Credit score is in 3 digit number range from 300 to 900. If your credit score is 750 above, then there is the possibility of a loan getting easily.
- Loan Amount: Higher loan funds mean the applicant must pay a high-interest rate. higher loan payment leads to a greater instalment payout that increases the creditor’s risk of default
- Loan Term: Longer return terms generally lead to high-interest rates and vice versa.
- Current Outstanding Debt: In the case of pending debt, a higher interest rate may be charged on a consumer durable loan, which raises the risk of default for the Creditors.
You have read in this article about Consumer durable loans, loan types, features, eligibility criteria, documentation, etc. Before taking the loan, you must study interest rates, compare different creditors’ rates, and all other fees. Then you should make the decision after comparison.