A Medical Loan is an unsecured personal loan that can be availed for any medical procedure. The interest rates and repayment terms vary according to the lender. Many NBFCs provide these loans online with an easy documentation process.
What is it?
Medical Loans are personal loans that provide funds for the borrower to pay for healthcare expenses. It is unsecured, meaning no collateral is involved, and the borrower does not have to give any assets as security for the loan.
They are typically taken out by people who need money for medical treatment but do not want or cannot use their credit cards or other forms of financing like payday loans because they don’t want to take on more debt than they can afford. They are available from many different lenders, including banks, credit unions and online lenders.
What are the expenses that these loans can cover?
Medical Loans can cover the following expenses:
- Medical treatment
- Hospitalisation
- Disability
- Medicines and consumables
- Ambulance charges
- Ambulance services (emergency cases)
The interest rates and repayment terms
The interest rates and repayment terms of such loans differ from personal loans. For example, the interest rates on such loans are typically higher than personal loans because they’re secured by collateral. This means you need to pay back your loan even if you stop working because your bank will get their money back through your salary again.
How can you avail of one?
There are several ways to avail of the loan. One can apply for the loan online, from a bank or an NBFC, and through an online portal. The best way to apply for a loan is by visiting a lender’s website and filling out the form. This helps you get quotes from different lenders and choose the one that offers better interest rates.
How to choose the right lender?
Consider the following tips while selecting the lender:
- Interest rates and repayment terms: It is always better to go for the lowest interest rate. The loan repayment term should be flexible and suit your financial condition.
- Hidden charges: Avoid lenders who charge any hidden costs, as it can affect your credit score negatively and lead to a higher interest rate if you cannot repay the money on time.
- Loan processing fee: There should be no extra fee charged by the lender apart from the application fee when taking a loan against property or car title deed, etc. Processing fees may vary based on different factors, such as the documentation involved in getting approval from the bank/lender and the type of property used as collateral security.
- Prepayment penalty: Some lenders charge prepayment penalties if you want early settlement before the maturity date without giving any reason, so check if there’s any such clause mentioned in agreement documents before signing up for a loan.
- Secured vs unsecured loans – Depending upon how much proof has been provided regarding income/employment status and other required documents like passport copies etc.
Can one get a loan without having insurance?
Yes, you can get the loan without having insurance. People do this because they want to pay the premium independently, not through the company. There are some things that you will need to apply for a loan without having insurance:
- Proof of your income
- Bank statement
Conclusion
It is a personal loan that can be availed for any medical procedure. You can choose the lender of your choice and apply for the loan without any hassle. The amount will be transferred directly into your bank account after approval from the lender.