Similar to how enterprises opt for loans to expand and grow their business, professionals, such as doctors, chartered accountants, and lawyers, seek loans to expand or upgrade their practice. For instance, doctors require financial assistance to run their clinics. These clinics require renovation from time to time, and the facilities need to be upgraded to keep pace with the evolving technologies. Doctors also need to increase the workforce over time, and all of this requires significant investment.
For this purpose, financial institutions in the country have designed specific loans for professionals. These are unsecured loans; they do not require any asset to be pledged. You will come across instant loans for doctors and personal loans for CAs. These are loans designed for professionals who provide professional services by charging a fee.
Know More About Professional Loans
Whether you are a doctor, photographer, CA, or management consultant, you are a professional offering your services. Over time, you may want to expand your business by opening a new office or upgrading your equipment. You must have access to adequate capital to accomplish these goals, and you can apply for a professional loan to meet these requirements.
Various financial institutions today offer professional loans, and these are mostly unsecured. However, if you are applying for a significant loan amount, you may have to pledge your asset as collateral.
Features of a Professional Loan
- Significant Amount: Professional loans range up to ₹50 Lakhs.
- Unsecured Loans: Typically, these are unsecured loans, and do not require any security or collateral. However, the financial institution may ask for collateral if the loan amount is significant.
- Flexible Repayment Periods: The tenure of professional loans can range from twelve months to five years.
- Interest Rate: The interest rates of these loans depend on various factors, such as the nature of your profession or business, credit score, debt-to-income ratio, etc. Usually, the interest rate for professional loans ranges from 14 percent to 20 percent.
- No Restrictions: You can use the professional loan for various purposes, including using it as your working capital, purchasing equipment, or renovating your office.
- Simple Application Process: You can apply for a professional loan online in just a few steps. These loans require minimal documentation, and you can finish the application in just a few minutes.
- Fast Loan Disbursal: Financial institutions offer instant loans for doctors and other professionals. You won't have to wait for weeks to get access to the loan.
- Part Prepayment Option: If you want to prepay a portion of the professional loan amount, you can do so against minimal or zero charges.
Types of Professional Loans
- Professional Loans for Doctors: If you are a doctor and require capital to expand your practice or renovate the clinic, you can avail of loans up to ₹45 Lakhs. Additionally, banks and NBFCs offer instant loans for doctors, so you won't have to wait for an extended period.
- Professional Loan for Chartered Accountants (CAs): Personal loans for CAs often fall short of the required capital. By applying for a professional loan, you can consider expanding your business, paying rent and bills, purchasing equipment, and managing cash flow. You can get a professional loan of up to ₹40 Lakhs.
- Professional Loan for Company Secretary (CS): You can apply for a Company Secretary loan to buy new space for your office, pay for the operational costs, improve professional skills, etc.
- Professional Loan for Lawyers: You can apply for a professional loan for lawyers if you are thinking about moving into a new office, or want to hire people. Interest rates against these loans are affordable. However, you must practise for three years and show good profits to avail of these loans.
- Professional Loan for Engineers/Architects: Engineers and architects can apply for professional loans and get access to credit. However, you must prove your track record, and show good income, experience, and reputation.
Ways to Fast-Track Loan Approval for Professionals
Instant loans for doctors and personal loans for CAs allow professionals to renovate their clinics or offices, and grow their practice. Typically, these are unsecured loans and do not come with restrictions. However, following these five simple steps can improve your chances of getting professional loans.
- Apply for the Loan Online
Online application has several benefits, including minimal documentation and quick approval time. You can apply for a professional loan in just a few minutes by filling out a form and uploading the required documents. You will get a confirmation message if you agree with the terms and conditions and are happy with the interest rate. Once the lender approves the loan, the amount will be disbursed in just 1-2 days.
This way, lenders can offer instant loans for doctors, and disburse the loan amount within a day of approval.
- Improve Your Credit Score Before Applying for the Loan
Whether you are applying for a personal loan for CAs or a professional loan for doctors, your credit profile will inevitably determine your creditworthiness. It is important that you maintain a healthy credit score before applying for a loan. Ensure you have a minimum credit score of 700 to get attractive interest rates.
- Lower Your Debt-to-Income Ratio (DTI)
Your debt-to-income ratio provides insights into your monthly income and your liabilities. Ideally, you must maintain a debt-to-income (DTI) ratio of less than 50%. The lower the DTI ratio, the better your chances of getting loan approval.
- Invite a Co-Applicant
With a co-applicant or a co-borrower, you stand a better chance of availing the loan amount. Ensure the co-applicant has a good credit score, as they share equal responsibility for repaying the amount. If the co-applicant is a respected member of society and earns a decent amount, your chances of getting approved for the loan increase considerably.
- Go With a Lender that Understands Your Needs
It is equally important that you choose a lender that understands your needs and requirements. Getting a personal loan for CA becomes easier if you have an existing relationship with the lender. Doing so will also result in attractive interest rates, favourable repayment terms, and quick loan approval and disbursal.
Conclusion
Whether you are looking for loans for doctors or CAs, by following the steps mentioned above, you can get access to professional loans without any hassle. Ensure you apply online, and have a decent credit score. Furthermore, keep your debt-to-income ratio low, and apply for the loan with a co-applicant if possible. Finally, you should approach a lender who understands your requirements, and with whom you have an existing relationship.
