Personal Loan Duration

A personal loan’s duration usually ranges from 3 months to a maximum tenure of 96 months. The tenure you opt for plays a significant role in determining your EMI payouts.

Usually, a long tenure could translate to smaller EMIs. This is because the sum to be repaid spans across a greater period, but a longer tenure also means an accumulated interest amount, possibly resulting in you paying above and beyond the original borrowed sum. 

In contrast, a shorter tenure would mean higher EMIs, but also less accumulated interest. Thus, a fine balance needs to be settled between these three factors to implement a payment plan that does not affect your finances. Additionally, having a strong CIBIL score can help you qualify for more competitive loan terms, potentially making it easier to choose the right tenure for your needs.

Depending on the lender you choose to get the loan from, the maximum tenure offered will differ. Most lenders offer personal loans with a repayment period of up to 96 months. A longer loan term makes it easier to manage your loan instalments. It spreads the cost of the loan over 8 years, easing your financial burdens. The lower EMIs that you get with these loans enable you to manage your monthly expenses better.

On Bajaj Markets, you can get a personal loan for a tenure as short as 90 days. However, this will depend on your eligibility for the loan and the chosen lender’s policies. A shorter repayment period can help you extensively save on the interest charges accrued over the loan tenure. This helps you benefit from a lower borrowing cost, helping you save money, which you can divert to fulfil other monetary requirements and obligations.

Here are some factors to take into consideration when choosing your personal loan tenure:

1. Monthly Expenses

Having a clear picture of your monthly budget is key to formulating an optimum repayment plan. Charting out your current fixed and variable expenses and comparing them to your net monthly income will help you ascertain the balance amount that can be set aside for your EMIs.

2. Prospective Increase in Income

If you are due for a raise in your salary or are expecting an increase in income from new assets or enterprises, choosing a shorter repayment period will save you money in the long run. While initial payments may stretch your budget, the interest accrued will be lower in the case of a shorter tenure. However, you will be required to make higher monthly payments.

3. Existing Debts

Be sure to include any existing debts or obligations in your repayment plan. Picking a tenure that allows you to pay your existing liabilities, in addition to the EMIs on your personal loan without placing a burden on your income would be a preferable way to approach this situation.

4. Personal Loan Interest Rates

Longer tenures generally result in higher personal loan interest rates. This is mainly due to such longer arrangements being viewed as high-risk investments with more chance for the borrower to default on payments. It is vital to find a balance through tenure with an interest rate that suits your ability to keep up with payments.

There are two effective ways to increase your personal loan tenure:

• Option 1 - You may request your bank/NBFC to extend the tenure by submitting a written application. Herein, mention the reasons for the request and provide supporting evidence to strengthen your case. Your lender will evaluate the application before approving the request.
  

• Option 2 - Transfer your personal loan balance to another lender. When you transfer the personal loan balance to another bank/NBFC, you can opt for a longer loan repayment tenure.
  
  

Understanding your own repayment capability is the first step towards selecting an appropriate tenure.

Reference of all T&C necessarily refers to the terms of the Partners as regards to pre-approved offers and loan processing time amongst other conditions.