10 reasons to choose a personal loan for medical treatment
A medical emergency can knock on the door when you least expect it. While most of us prepare for this by purchasing medical insurance, more often than not these policies do not cover all aspects of a medical bill. Issues such as insufficient sum insured, illness not covered by the policy, or hospital not listed on the insurer’s TPA (Third Party Administrator) panel can hinder the required treatment. A sudden need of such a nature may cause you to seek financial assistance from friends and family. In such cases, an alternative source of financing such as a personal loan can come to your aid. Here’s everything you need to know about personal loans and why you should get them for a medical emergency.
A Personal loan for a medical emergency is an instant loan facility that one can take during a financial crisis like a medical emergency. Many banks and NBFCs (Non Banking Financial Companies) offer this emergency loan for heavy medical bills, consultation fees, diagnostics, etc.
Here are some key benefits of taking out a personal loan for medical emergencies:
● Quick treatment: Reputable financial institutions understand the urgency of a medical emergency and therefore offer a comprehensive digitized application process with minimal documentation, allowing you to receive funds quickly.. A loan for a medical emergency is approved quickly and paid directly into the borrower’s account within a day or two, or even sooner. However, it is crucial that borrowers meet the eligibility requirements.
● Minimum documents: A medical loan requires minimal documentation. Applying online is a 100% paperless process.
● No warranty: Since it is an unsecured emergency loan, you don’t have to worry about collateral or collateral on this loan.
● High loan amount: One can apply for up to INR 25 lakhs* as a personal loan for medical emergency to meet all medical requirements easily.
● Treatment anywhere: You can use this loan amount at any hospital or private treatment center to pay bills, diagnoses, etc.
● Availability of all medical facilities: Unlike medical insurance policies where only limited ailments or procedures are covered, All types of treatment are possible with an emergency medical loan.
● Attractive interest rates: Various lending institutions offer attractive interest rates to highly eligible borrowers. Your eligibility for a personal loan is highly dependent on your income, age, credit history, ease of repayment, and other factors. Financial institutions like Fullerton India have simplified the eligibility criteria and online application process that will help you to fulfill your medical loan requirements easily.
● Instant Funds: After the document verification and evaluation process is successfully completed, the lender will approve your loan, soon after you will receive the loan amount.
● Flexible repayment: Return the medical emergency loan with equivalent monthly installments (EMI). For most banks and NBFCs, the standard repayment period is between 12 and 60 months.
EMI Calculations for Medical Loan:
The equivalent monthly installment is the amount a borrower pays each month to the bank or NBFC to take out the loan. It is calculated based on the loan amount, term and interest rate. The formula to calculate EMI is,
E = Pr (1+r)n(1+r)n-1
E = NDE
P = Loan amount
r = interest rate (monthly)
n = total number of months
If you take a medical loan of ₹2,00,000 at 6% annual interest and repay for 4 years.
r = 6% per year = 0.005 (monthly)
n = 4 years = 48 months
The EMI will be,
E = 2.00.0000.005 (1+0.005)n(1+0.005)n-1 = ₹4.697
Hence, you have to pay the EMI monthly of Rs. 4,697 for 48 months.
Since the interest rates are different for different banks and NBFCs, the EMI will vary. It is important that you always calculate your EMI based on your income and decide the right medical loan term accordingly.
Procedure for applying for a medical loan:
● Choose a reputable lender whose personal loan eligibility criteria matches your profile and offers the loan at a competitive interest rate. Select the optimal loan amount you need for processing by checking the maximum amount you could qualify for using a personal loan eligibility calculator.
● To apply, visit the lender’s website or download their mobile app. Register your mobile number with OTP verification to start your journey
● Fill in the personal, professional and financial information in the online application form
● Submit the necessary information personal loan file required for the loan
● Upon successful completion of your documentation and verification process, the approved funds will be credited to your bank account.
A personal loan can be a boon, especially in an emergency. The quick and easy approval process, minimal documentation, and instant payout can save your life. So the next time you or your loved one need medical treatment and need quick funds, you can choose to apply for a personal loan.