Personal Loans for Senior Citizens

Personal Loan for Senior Citizens


Now, even senior citizens are eligible to apply for personal loan, especially if they are drawing pension every month.

When a person is nearing the retirement age, most of the people are worried about how will the expenses managed. Most of the people believe that money saved in working life is enough to support the old age. However, with increasing health care costs and personal expenses, the accumulated money is not enough. Such situations make senior citizens look forward to personal loans to fulfill their needs. Personal loans are a boon in the financial market today. They are very useful when someone is in immediate need of money.

It is easy to apply with quick loan disbursement. But these loans are only available for people to have a source of steady income. In earlier days, senior citizens were exempted from this facility because they were able to provide income proofs. However, today banks promote financial independence for retired personnals by offering them pensioner loan or personal loan.Now, even senior citizens are eligible to apply for personal loan, especially if they are drawing pension every month. Many nationalized banks offer loans to senior citizens. The only requirement is that they should maintain a pension account. Without a steady repayment source, banks do not offer loans.

Purpose of Personal Loans for Senior Citizens

There could be ample reasons for which someone would require a personal loan. In case of senior citizens, the loan can be availed for meeting various expenses, especially during emergencies.

- Medical Expenses

Medical expenses are common with senior citizens. Though most of the people have medical insurances today, yet there could be some extra expenses like tests, medicines, doctor visits etc are some reasons that require cash and mostly not covered in insurances. Such things can be paid via personal loans

- Home Renovation

Personal loans are available for any kind of home renovation. Whether they need it for kitchen up door complete interiors, everything can be covered in personal loan.

- Wedding

Usually senior citizens require money for the purpose of marriage of their children. Weddings require immediate cash and personal loan for wedding cost become very handy in such situations.

- Children Education

Education is expensive these days and in order to provide the best education to their children, senior citizens look out for personal loans. Education loans are also available, but there is a lot of paperwork and time required to apply for education loans. Personal loans for education are quick and convenient.

- Travel

Completing the Char Dham yatra is the mission of every senior citizen. It is believed that visiting all the Dham is a gateway to heaven. Hence, most of the retired people require loans to cover the costs of travel

Features of Personal Loans for Senior Citizens

There could be a wide range of reasons for which an individual may require a personal loan. The reason people look for personal loans is that:-

- No Restrictions

Like other loans, personal loans can be used for any reason. There are no restrictions on how you could use the money. For instance, home loans are only provided if someone is buying a home. Papers for the purchase of property are required by the bank in order to disburse the loan. Similarly, for education loan, parents need to submit proof of admission to college and then only they will be granted the loan. With a personal loan, there are no such restrictions on how the borrowed amount is finally used.

- No Collateral Required

The Personal loan is an unsecured loan. This means that banks do not require any kind of security to sanction the loan. Though even personal loan is factor dependent, if a person qualifies to receive the loan, it can be disbursed immediately.

Benefits of Personal Loans for Senior Citizens

There are numerous benefits of taking a personal loan
  • No restriction of how the loan money is utilized
  • No security required
  • Quick disbursement
  • The borrower has the flexibility to choose the tenure of the loan
  • No fluctuations in the rate of interest and low-interest rate for senior citizens

Banks that Offer Personal Loans to Senior Citizens

There are various banks that offer loans for pensioners. There are banks from a private/public sector that offer loan facilities to the retired people. Some of the top listed are mentioned below:-

- Bank of India

BOI personal loan has special features and benefits for senior citizens. However, they would only provide loans to pensioners who are below the age of 75.

- State Bank of India

SBI personal loan for pensioners for up to 14 lakhs. But it eligible for only central and state government employees with an age limit of 72 years.

- Dena Bank

Pensioners with age between 73 to 80 years can avail personal loan from Dena bank

- Allahabad Bank

The loan is offered to senior citizens with an age limit of 73 years.

- Bank of Baroda

BOB personal loan is not for pensioners who have exceeded the age limit of 65 years.

- Syndicate Bank

In order to avail personal loan in syndicate bank the pensioners need to have a pension account with the same bank and the age should not exceed 70 years.
Each bank has the own norms and interest rates. Compare the interest rates from the comparative search engine on our website to know which bank offers the lowest rate of interest with additional benefits.

Eligibility for Senior Citizen Prsonal Loans

In order to apply for personal loans, the applicants have to qualify the eligibility criteria, only then they are granted loans from the bank. Some of the factors that are important in personal loan approval are:-

- Age

With senior citizens, age is an important factor to apply for loans. The age limit criteria depends from bank to bank.

- Income

The personal loan is only for those people who have regular monthly incomes. In case of senior citizens, they need to have regular monthly pensions to apply for a personal loan. They can also use a co-applicant as their guarantor to apply for a personal loan.

- CIBIL Score

Credit score is highly important even in the case of senior citizens. You may have met the age and income criteria, but if the credit score is low, chances of approval are less and even if the loan is approved, the interest rate will be higher

Documentation for Senior Citizen Personal Loans

Once the eligibility criteria are met, the next step is the documents. Here is the list of documents that need to be provided to the bank while applying for a personal loan:-
  • Proof of Identity
  • Address Proof
  • Bank statements of last 6 months or passbook copy
  • Retirement proof from the organization last worked
  • Last pension receipt
  • Post the submission of documents, the bank would decide to disburse loans.

How to Apply for Personal Loan?

Applicants can directly visit the bank to apply for the loan or if they are well versed with the internet, they can even apply online. Online application of loan is easy and convenient. The applicant needs to just fill in the details on the online form and the request will be forwarded to various banks. They would then send their executive to the residence to collect the documents.

Other Options of Quick Cash

Personal loans are easy but they are dependent on various factors. If any of the factors are not met, the bank is authorized to deny the loan. In such cases, senior citizens can look for other options.

- Loan against securities

Some private sector banks like ICICI, Axis, and HDFC offer loan against securities like shares or mutual funds. The applicant needs to pledge their securities to the bank in order to avail the loan

- Against LIC policy

Not many people are aware, but there is an option of loan against LIC policy. It works similar to securities. Senior citizens need to pledge their policies to avail this loan Gold Loan – Another kind of secured loan is a gold loan. It's quick and easy. The applicant needs to take gold to the bank and 70% of the total value of gold can be availed in the shape of a loan.

- Private financers

nowadays there are many private finance companies who offer loans to people who are unable to meet the eligibility criteria of banks. However, they charge a high rate of interest compared to normal banks.

Some Advice

Even though the personal loan is an easy and convenient way of borrowing money, but it should only be taken if you really need the funds. Life is very uncertain in such age; Hence, it should be well thought and researched.