An emergency personal loan is one that people get in support of their medical requirements. Anyone can get a medical loan to fund major and minor operations, surgeries, therapies, cosmetic dental implants, cosmetic facelifts, botox injections, eye surgery, hair transplant and any general critical or non-critical medical procedure. Even a borrower’s dependents can avail of the benefits of a medical loan for various treatments and procedures.
A personal loan for medical emergencies should be quick and hassle-free. This is now possible with the emergence of online banking and loan aggregators. Online banking has made getting a loan a very easy process which has benefited many people, especially when times are hard. So, if you wish to get a personal loan for medical needs today.
Buddy loan is an online loan aggregator which can help you get an instant personal loan for medical emergencies. Download the Buddy Loan App today and get interest rates starting at 11.99%p.a.
As a borrower, when you get a medical loan, you can get whatever funds are required for a medical procedure. At the same time, you can also enjoy many benefits and features of a medical loan. So, what are these features of a medical loan?
Features of a Medical Loan
An emergency personal loan for medical reasons will have features that are similar to regular personal loans. Some of these features are:
Quick disbursement of the loan:
Most bank lenders and financial institutions offer quick disbursals of emergency loans. Especially when the loan is applied online, the processing time is faster as the documents are digitally processed. Depending on the lender and the borrower’s credit score and documents, it takes about 2-7 days to disburse the medical loan. Some banks also offer pre-approved loans to select customers, which can disburse these loans even faster.
No collateral required:
Medical loans are unsecured, so you do not have to submit any collateral to get the loan.
Minimal documentation:
There needs to be more documentation that is needed to apply for a medical loan. You will only require documents for the following:
- ID proof: Passport, Driving licence or PAN card
- Address proof: Passport, Voter ID, Ration card, Driving licence, Recent electricity or telephone bill
- Age proof: Voter ID, Driving licence or Aadhar card
- Income proof: Salary pay slips and bank statements.
Flexible repayment tenure:
Lenders would usually offer flexible repayment tenure on emergency personal loans for medical emergencies. The loan can be repaid in instalments for a tenure of either 1 year up to 5 years or can even go up to 7 years.
With any loan that you take, there is always an eligibility requirement, so below are the requirements for a medical purpose loan.
Eligibility Criteria For Emergency Personal Loans
In order to be eligible for a medical loan, a borrower should be at least 21-60 years old and be salaried or self-employed. The minimum salary requirement will differ from one lender to another, and some lenders will accept a minimum salary of Rs 15,000 a month, while some will ask for a minimum salary of Rs 20,000 a month. Applicants with a credit score of 750 and above will have a higher chance of getting their loan approved. They will also be eligible to get a lower interest rate.
Medical Loan & Its Interest Rate!
A medical loan is a type of emergency personal loan, so the same policies and procedures that apply to personal loans will also apply to medical critical care loans. The interest rates of a medical loan will be the same as that of a personal loan, and because it is an unsecured loan, the interest rate might be a little higher. So, also the interest rates will differ from one lender to another, and if you choose to take a loan from online aggregators, you will get to compare rates between lenders. Thereby choosing the best rate that suits you. Some comparative interest rates between loan aggregators on emergency personal loans are:
| Banks | Interest Rate |
| Bajaj Finserv | 11%p.a |
| Fullerton | 11.99%p.a |
| Money Tap | 13% p.a |
| Buddy Loan | 11.99%p.a |
| Paisa Bazaar | 10.49%p.a |
What you need to know about Interest rates
- High interest is levied on borrowers who need to provide adequate documents such as PAN cards, Aadhar cards and Salary certificates.
- People who do not have a good credit score will also get higher interest rates. You should also note that it is the bank’s discretion to give the medical or hospitalisation loan. You should always call the bank directly and check with them.
- Interest rates start at 11.99%p.a on Buddy loan.
Most earning and responsible individuals can take a medical loan during emergencies, but what if they have medical insurance?
The Difference Between Medical Loans & Medical Insurance
Medical loans and medical insurance are entirely different. An insurance company provides medical insurance to a holder who pays a yearly premium to maintain the insurance policy. Insurance companies allow cashless treatment to insurance policyholders and their dependents. The insurance company will claim the hospital expenses after the patient has been discharged.
However, a medical loan is an emergency personal loan that is taken to fulfil medical requirements that the borrower can avail for themselves or their dependents. The loan can be taken even if the borrower has an insurance policy. A borrower with an insurance policy can take a medical loan if the amount is outside the insurance policy coverage. For example, if the insurance policy coverage is only up to Rs.5 lakhs, but the medical expenses incurred are Rs.7 lakhs. The insurance policyholder can take two lakhs to cover these medical expenses.
Anyone can apply for a loan, but the question is, “does every policyholder need to apply for a medical loan?” Well, the answer to that is no. There are only certain situations when a policyholder will need to get a medical loan.
Also Read: An Unsecured Personal Loan for Medical Emergencies
When Can Policyholder Apply for Medical Emergency Loan?
- An insurance policyholder who wants to fund the medical expenses of a third party who is not their direct dependent can apply for a medical emergency loan.
- An insurance policyholder can apply for a medical loan when the medical costs are outside the coverage.
- Getting a medical emergency loan will be ideal if the insurance policy does not offer a cashless facility. Most insurance companies nowadays do not require medical bills to reimburse medical expenses, although some still do. Always remember to resort to reliable and solid cash insurance policies.
- A non-insurance policyholder who wants to cover medical expenses for themselves, their dependents, or unrelated third parties can also get an emergency personal loan.
Knowing when to get a loan and when not to is essential. This is because you want to avoid being in unnecessary debt. So read below to find out when you should not take a medical loan.
When Not To Take A Medical Loan
- If an insurance policy covers the medical expenses, then there is no need to get a medical loan.
- A person without an insurance policy will not require a medical emergency loan if they can cover medical expenses with their extra savings.
A medical loan has interest charges which are comparable to personal loans. So, only take a medical loan if you do not have surplus funds or insurance policy coverage. Otherwise, it will be a loss of income due to interest charges. The minimum tenure for repayment is 12 months, and the foreclosure can be made only after that.
Also Read: Loan on Aadhaar Card for Medical Emergency
While looking for a personal loan for medical emergencies, you can come across terms like No-cost equated monthly instalment medical loans. Please read below to know what they are.
What Are No-Cost Equated Monthly Instalments Medical Loans?
No-cost equated monthly instalment medical loans are loans where the medical treatment centre bears the interest cost. No-cost EMI means that the borrower only has to pay the principal amount. For example, for a medical loan of Rs.1,20,000, the borrower has to pay Rs.10,000 for 12 months. The hospital will pay a subvention charge, a percentage of the medical loan amount, to the lending institution as the interest rate.
While No-cost EMI can be a great option for people, it can also be unfavourable for some.
Why Avoid No-Cost EMI Hospitalisation Loans?
These no-cost EMI loans are not favourable as the hospital could raise the medical expenses to make up for the subvention fee that has to be paid to the lending bank. For a treatment cost of Rs. 1 20, 000, the hospital could charge Rs.2 lakhs.
Part of the profits realised from over-charging the patient can be paid as a subvention fee to the lending institution, which will still leave the bank with a profit. However, if a no-cost EMI is a good option for you, find out what you need to do before availing of it.
Also Read: Get An Instant Medical Loan to Increase Your Credit Score
Preparing for No-Cost EMI Medical Loan
Before availing of any loan, it is always good to research the pros and cons to understand the available choices better. Below are some of the things you need to know before availing of a no-cost EMI medical loan:
- Compare the treatment prices between different hospitals. Read reviews from patients of the hospitals and ask around.
- No private hospital will operate on a social-service philosophy. Therefore, even after paying the subvention fee, the hospital will still look to make a profit. Look for an ethical hospital where one can expect the hospital to make a nominal profit that is not burdensome on the borrower.
You can always enquire and get more information by calling your bank and asking them to guide you. Try to steer clear of no-cost EMI loans as much as you can. Do a complete research and study the product aggregator’s sites. The different terms and conditions, tenures, interest rates, documents required and more. If the no-cost EMI option is not for you, then you can learn how to calculate the EMI for an emergency personal loan for medical purposes.
Calculate The EMI For Medical Loan
Since a medical loan is no different from a personal loan, the EMI calculation methodology that applies to a personal loan also applies to a medical loan. Certain banks lend instant emergency loans with zero processing fees. There are also a number of online EMI calculator that you can use, but if you want to show off your maths skills, the formula is given below.
EMI calculation methodology on medical loan
The formula is:
P x R x (1+R) ^N] / [(1+R) ^N-1
Where P is the principal amount.
R is the rate of interest per month.
N is the tenure of the loan in months.
^ is to the power of
Also Read: How To Get A Personal Loan Fast With A Poor Credit Score
Medical emergencies can happen anytime, so getting a loan as quickly as possible is essential. Want to know where you can get a quick medical loan disbursal from?
Where to Avail A Medical Loan From
If a person applies for an instant emergency loan directly from the bank, they will likely get it; however, the process might be slow. Banks’ highest priority will always go to the highest credit score holder. If your credit score is higher, your profile will be able to catch up. A person who gets a loan from an aggregator can get it much quicker. Buddy Loan considers your credit score essential, but the emergency will always be a priority.
With inflation, there have been increased medical costs and restrictions on health insurance coverage, leading to most people acquiring medical debt. Getting an instant medical loan is a way out of this inconvenience.
What are the Implications of Taking Up a Medical Loan?
A medical loan allows one to manage healthcare expenditures on a predefined or custom-created payment schedule. Taking this loan is a significant step in the quest to help one pay for healthcare needs while avoiding the pressure of worrying about collecting the necessary funds.
Some of the various medical situations and procedures where medical loans might help are mentioned below:
- Fertility treatments
- Visit a Gynaecologist or obstetrician
- Orthodontics
- Cosmetic surgery, weight loss-related surgery, etc
- Unexpected events that need medical attention, like accidents, disease, etc
- Consolidated medical debt
In Conclusion
Taking an emergency personal loan for medical purposes will give you a lot of benefits, as a medical loan will provide you with sufficient access to funds in times of need. Medical emergencies are also time-sensitive, so having access to online aggregators like Buddy loan for quick disbursal of instant loans has been a great advantage. Hopefully, this article has provided good insights on emergency personal loans for medical purposes.
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Frequently Asked Questions
Q. Why is a medical loan better than medical insurance?
A. A medical loan will help you get the required funds faster than medical insurance. The reason is that you will already have the amount in your account. Also, with a personal loan for a medical emergency, you do not need collateral if you opt for an unsecured medical loan. The Buddy Loan App disburses this kind of loan. You can also get better financing rates and options through medical loans compared to a medical service provider.
Q. Can you get an emergency personal loan for bad credit?
A. Getting a personal loan would be a great idea if an emergency occurs and there is a need for immediate funds. But what if you have a bad credit score? It may feel like it would be impossible. However, getting an emergency personal loan for bad credit is possible with various lenders who ask for low credit scores. You have to choose the right one. Buddy Loan is the best platform to help you find the right lender for your personal loan to cover your medical emergencies.
Q. What is the difference between a medical equipment loan and a medical loan?
A. Often a medical loan needs to be clarified with a medical equipment loan. A medical equipment loan is also known as healthcare finance. It is a business loan for procuring medical equipment to set up a business such as a hospital, clinic or laboratory. So, be clear about the type of loan you want to take while talking to a customer care representative.
A medical loan is a great saviour if used wisely and taken only when needed. It is advisable only to take this personal loan for medical emergencies to cover necessary or dire-need medical expenses.
