Unsecured bank loan - Convenient and quick financial solution

1. What is an unsecured bank loan?

Unsecured bank loans, also known as unsecured loans, are a form of loan in which the borrower does not need to provide collateral. Unlike mortgage loans, when assets such as houses, land or vehicles are used as collateral, unsecured loans will rely on the borrower's reputation.

Banks or groups cFinance will approve loans based on a number of important factors, including income, credit history and the borrower's ability to repay. The customer's reputation will be the main deciding factor appropriate loan limit.

Unsecured loans often have lower limits than other forms of loans, so they mainly serve customers who need to borrow capital for consumption purposes. such as: studying, traveling, home repair, shopping for personal items or transportation. 

In addition, unsecured loans also support urgent expenses that the borrower does not want or cannot use assets as security.

2. What are the characteristics of unsecured bank loans?

Because no collateral is required, unsecured bank loans have many differences from mortgage loans. You can follow the table comparing these two types of loans below:

3. Benefits and limitations of unsecured bank loans

Thanks to simple convenience, unsecured bank loans are increasingly chosen by many people. However, this form of loan also has certain limitations. Specifically:

4. Who can get a bank loan without collateral?

To be able to get an unsecured bank loan, most banks require borrowers to meet the following basic conditions:

• Be a Vietnamese citizen.
• Age: 18 – 70 years old. Some banks may limit lending age to under 55 years old.
• People capable of exercising civil rights and obligations.
• Have a stable monthly income. Depending on bank policy, the borrower may require a minimum income level (for example: Minimum salary income of 5 million VND or more, minimum pension of 2 million VND or more).
• Permanent or temporary residence in the area where there is a bank branch lending capital.
• Good credit history, no bad debt at banks or other financial institutions at the time of loan.

5. Procedures for unsecured bank loans

Currently, people who want unsecured bank loans can borrow capital in the following forms:

• Loan via payroll: This is the most popular form of loan, applicable to people with stable income from their current job. Borrowers will provide payroll, bank account statements or labor contracts to prove income.
• Get a loan via Credit card limit: Some banks allow unsecured loans based on credit card limits, provided the customer has a good credit history and credit balance has not exceeded the allowable limit.

Loan procedures for each of these forms will depend on the specific regulations of each bank, but in general they will include the following documents:

• Personal profile: ID card/CCCD or valid passport, household registration book or temporary residence certificate.
• Records showing personal income: Statement of the most recent 3 - 6 months' salary, labor contract or income certificate (for freelancers or business owners).
• Application for unsecured loan (form of nrows).
• Credit card statement (for credit card loans).
• Some other documents according to the regulations of each bank and loan package (for example, business license, work confirmation...).

The unsecured bank loan process is usually done quickly through the following 4 steps:

• Step 1: Submit an application with all necessary documents for an unsecured bank loan directly at the nearest branch or through the bank's online channels.
• Step 2: The bank evaluates and approves the customer's application. Approval time usually ranges from 3-5 working days or may be sooner depending on the working process of each bank.
• Step 3: After the application is approved, the customer will sign a loan contract with the bank.
• Step 4: Receive disbursement via bank account or cash.

6. Note when borrowing from banks without collateral

Any loan has the potential to pose financial risks. Therefore, when deciding to take a bank loan without collateral, you need to keep in mind:

Choose a reputable bank:

A reputable bank provides attractive loan products with a clear, transparent loan process and customer information security. At the same time, reputable banks also ensure benefits for borrowers throughout the loan process. 

Research banks carefully and refer to reviews from customers who have borrowed before to make the right choice.

Carefully check the interest rate

Unsecured bank loan interest rates are usually acceptable calculated as a percentage of the total loan amount. Loan interest rates can depend on many factors such as income, credit history of the borrower and preferential policies of each bank.

Banks currently have two ways to calculate interest as follows:

• Fixed principal, decreasing interest: Each month, you will pay a fixed principal, interest will be calculated on the remaining principal balance, so it is more cost-effective.
• Principal and interest divided equally monthly: Each month you will pay a fixed amount including principal and interest. The total amount of interest in this case will be higher.

When borrowing capital, bPlease check the loan interest rate carefully. At the same time, consider specific loan terms to be able to plan your debt repayment clearly, in accordance with your financial capabilities.

Compare loan packages on the market

You should research and compare loan packages from many banks. Interest rate, loan limit, loan term as well as accompanying incentives or fees are factors that need to be considered carefully to choose the loan package that best suits your needs and financial situation.

Consider financial capacity

Unsecured loans are based on personal reputation and ability to repay debt. Before deciding get a loan, make sure you can maintain a reasonable financial plan to ensure you do not fall into bad debt, avoid risks related to not paying on time, affecting your credit score in the future.

Find out details about early payment penalties and other terms

Some banks will impose a penalty fee if you repay your loan early. This can affect the total cost of the loan. Please read the terms in the loan contract carefully to clearly understand any additional fees, including early repayment fees, application review fees, or other costs that may arise during the loan process.

Bank loans without collateral are a flexible and convenient financial solution for many customers. However, to choose the right loan product, you need to carefully consider the interest rate, loan term and accompanying conditions.. 

Contact SeABank via Hotline 1900 555 587 or visit the website www.seabank.com.vn for more detailed advice on attractive loan packages right!