What is a personal loan? Is personal Loan transferable or can it be transferred to another person? If you ever had these questions read on to find out more.
A personal loan, simply put, is an unsecured loan that one can apply for without any need for collateral and with little documentation. They are generally approved keeping two points in mind, namely, credit history and income of the borrower.
Is personal Loan Transferable?
- The answer to this is, yes, you can transfer your personal loan to another person. There are some Banks or Non-Banking Financial Companies that provide such facilities.
- Lenders do offer personal loan balance transfer, where one can transfer their outstanding loan to another lender but transferring loan to another person is not very common with the lenders.
- So it is advisable to first check with your lender whether they do accept personal loan balance transfer or not.
- The main thing to be kept in mind is that the person to whom a personal loan is being transferred should be eligible enough to pay off the loan later. He should meet the required eligibility criteria set by the lender such as - Age, Income, CIBIL score, Job stability, Monthly expenses, Work experience, etc.
- We have to make sure that the person to whom the personal loan is being transferred to, has all relevant documentation on hand, as discussed earlier, to have a smooth journey.
- Also, the lender may ask for a collateral/guarantee from the original person, in case the lender is not satisfied with the new borrower’s credit profile.
With a few formalities, your personal loan gets transferred to another person and now the new person is liable to repay the loan on a timely basis. However, do note that in such a case, the eligibility of the other person as well as his willingness will be taken into account and sufficient personal loan documents for the same needs to be provided.