The Ultimate Guide to Professional Loan Types and Requirements
Professional loans have become a popular type of unsecured loan. As the name suggests, these loans are meant to be given to the professionals such as CA or Chartered Accountants, CS or Company Secretaries, doctors, and other professional services providers. These loans are designed with attractive features such as low-interest rates, high principal amount, flexible repayment tenor, easy and quick loan approval, and more.
The professionals can take this loan to set up their new business, expand and upgrade their existing business, and meet other professional requirements. To avail of the loan, it is important to know all about it such as the eligibility, the documents needed, the types of professional loans, etc. Here is everything you need to know.
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What are Professional Loans?
Professional Loans are unsecured loans that are extended to professionals without needing any collateral. Unlike personal loans, professional loans are given to individuals needing money to match their business requirements and sometimes personal needs too.
This loan is designed for hard-working professionals who aspire to grow and expand their business. They can use the loan amount for carrying out renovation, extending their staff, purchasing new equipment, and augmenting professional efficiency.
Types of Professional Loans
Professional loans are given out to several types of professionals. There are several types of professional loans available:
- Professional Loan for Doctors: The doctors can use the loan amount to set up a new clinic, buy new medical equipment, invest in patient care, expand the premises of the clinic or hospital, and more.
- Professional Loan for Chartered Accountants (CA): The CAs can use the loan amount to set up a new firm, buy tools and electronic gadgets such as computers, etc., invest in carrying out the repair in the office, meet working capital needs, scale up operations, etc.
- Professional Loan for Company Secretaries (CS): CS professionals can use the loan amount to buy or lease office space, buy tools and electronic gadgets such as computers, etc., consolidate high-interest debts, augment professional skills, pay operational expenses, etc.
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Features and Benefits of Professional Loans
Here are the best features and advantages of professional loans:
- Professional Loans can be taken for a low principal amount to a very high loan amount of up to several lakhs.
- There is no requirement to submit security or collateral.
- The tenure of the loan can be for a period of 5 years.
- The rate of interest and the loan amount may differ with the type of profession. Usually, the rate of interest on the professional loan for Chartered Accountants, Doctors, CS, etc. starts from 11%.
- The professional loan can be used for the purposes like basic working capital needs, purchase of tools, renovation, property upgradation, hiring new team members, etc.
- The repayment of the loan is quite flexible and you can pay back the loan amount in easy EMIs.
- This loan promises a quick and easy online application.
- You don’t need to submit a lot of documentation to get professional loans.
Different lenders may have different professional loan terms and conditions. Go through the lender’s website to know more.
Eligibility to Get a Professional Loan
The eligibility criteria makes a professional loan different from a business loan. While any business owner can take a business loan, a professional loan applicant must have a degree. There are other eligibility criteria too that you need to know before applying for a professional loan:
- The professional loan can be applied by an individual or a firm with partners.
- Your age to take a professional loan must be between 25 and 65 years
- You need to have a professional degree or diploma in your field.
- You must be a self-employed individual.
- As per the type of loan, you also may need to meet specific profession-specific criteria too.
If you find yourself eligible and meet the above-mentioned criteria, you can apply for a professional loan from a lender.
How to Apply for Professional Loan?
Applying for a professional loan is very simple. All You need to do is follow the steps mentioned here:
- Firstly, you need to visit the lender’s website and find the tab mentioning Professional Loans.
- In the second step, you need to click on “Apply Now”.
- This will take you to a new page.
- Fill out the form and mention a few imperative details about yourself and your profession. You may be asked to enter your income, type of employment, contact number, address, etc.
- Now you need to enter the loan amount you want.
- You will also be needed to mention the tenor you want for your loan.
- Once your application is processed and approved, you will get the notification and the loan amount will be disbursed to your linked bank account.
Documents Needed for Professional Loan
Here are the documents required for getting the professional loan. You need to submit these at the time of applying for a loan:
- Proof of Identity which includes the papers such as a Passport, or PAN Card, or Aadhaar Card.
- Proof of Address that may include the documents such as a Ration card, or Aadhaar Card, or Utility bills like electricity bills, water bills, etc.
- Proof of your professional degree and diploma
- Proof of ownership or lease of a property where you are doing the business.
- Bank statement for the recent 6 months
- Profit and loss statements of the business you are into.
- Latest ITR
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You can avail of the professional loan without furnishing any collateral or submitting a whole lot of documents. A lot of lenders in India offer professional loans to customers at attractive rates. If you also want a professional loan, then apply for the same in the above-mentioned easy steps.