Doctors also need loans to fulfill their financial needs and expand their range of ventures. Whether it’s a new clinic, upgrading their medical equipment or increasing the span of their business, a professional loan for doctors is the way to fulfill it.
A doctor loan comes with the advantage of a collateral-free and no end-use application. Moreover, this loan offers tons of benefits for doctors facing a cash crisis. It is an instant and trouble-free pathway to expand your business.
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What exactly is a doctor’s loan?
A doctor loan is a specially fashioned credit system for medical practitioners. Doctors can use the loan amount for their business expansion and elevating their medical equipment. These loans offer you several benefits such as:
- No collateral and guarantors are necessary for the loan
- Avail flexible repayment duration up to 6 years
- Quick disbursal of loan amount
- Reasonable interest rate
- Nominal documentation needed
- Pre-approved loan process
Types of loans for doctors
This exceptionally designed doctor loan can be used for a variety of needs. Based on the purpose of your loan, it may fall under any one of the following categories:
- Personal loan
- Business loan
- Home loan for doctors
- Loan against property
A personal loan can be used for your doings and commitments. This includes your wedding, purchasing a vehicle, or your children’s higher studies. To apply for a personal loan, you should be a doctor working for a government or private hospital. You will need to earn a minimum income to get this loan.
Reference: Compare personal loan
In India, a personal loan offers an amount of up to 40 lakhs. You will not be asked to pledge any collateral. You need to submit a few documents as per need and they are usually approved in a day. The loan will be disbursed to your account within a couple of days. You can opt for a flexible tenure, starting at 1 year, up to 5 years.
A personal loan requires very few documents and saves you the time of drawn-out paperwork. You need to earn at least Rs. 25,000 a month to apply for a loan. The rate of interest on personal loans is lower for salaried than self-employed medical practitioners.
Business loans for doctors can offer an amount up to 45 lakhs. You can use the amount for professional expansion and benefits. This loan allows you to increase the span of your business and medical functioning.
You can also use it to develop your clinic or hospital. Furthermore, the loan will help you buy more diagnosis devices and other medical equipment like scanners, X-ray machines, sonography devices, or MRI machines.
A business loan can be expended on office equipment like computers, fax machines, and air-conditioners. It may also be used for buying medicines to increase their stock. These expenses are often called working capital.
Moreover, you can buy assets for your hospitals, such as an ambulance and a security system. A loan for business will help you realize all your professional needs.
Most banks offer pre-approved offers on a business loan for doctors. Besides, your loan will be disbursed in your account in just a day after approval. These loans are collateral-free too. You can present your documents as per requirement. On the whole, getting a doctor loan is a simple and a no-trouble process.
Home Loan for doctors
Doctors can apply for a high-worth home loan to build their dream house. In case you want to renovate your existing house, you can do so with your loan too. Usually, a housing loan for doctors will be approved within a day of the documentation.
In the case of doctors, pre-approved loans can be availed of most home loans. Several banks offer doorstep services for a doctor loan. In this loan, one can transfer the remaining amount for other financial needs.
They also propose property search assistance for doctors. They will help locate the best house for you, starting from searching to buying it. To know more about this service, discuss it with your bank officials and sales executives.
Loan against property
A loan against property is the best approach to avoid the risk of debts. You can apply for a doctor loan against any of your realty to expand your business. It requires pledging a preferably high-value property such as land and buildings.
Most banks offer a maximum loan of up to 70% of your property’s market value. And if it is a commercial premise, they may offer up to 60% of its value. But you should consult your bank to know more about their maximum loan amount against realty.
Moreover, you can avail of a flexible repayment feature of up to 12 years. Both salaried, and self-employed doctors, can apply for a loan against property. It requires very few documents and loans are disbursed in no time. Like all other doctor loans, these loans are pre-approved too.
Attributes of a doctor loan
Loans for doctors come with several attributes and benefits. By applying for any of the above loans, you can enjoy features such as:
Obtaining your doctor loan:
Mentioned below are some features that are unique to doctor loans:
- A loan for doctors is often sanctioned within 2-3 days
- You do not need to pledge any collateral
- It requires nominal documents and a simple paperwork
- Most doctor loans are pre-approved
- Almost all banks work on a nominal processing fee for a doctor loan
- These days, banks allow you to apply for your loans online
Benefits of a doctor loan:
Mentioned below are advantages of getting doctor loans:
- You may use your money for business expansion and purchase of medical equipment
- You get a flexible and prolonged tenure of up to 5 years
- You can opt for EMI or Equal Monthly Installments as per requirement, with our flexible repayment feature
- Interest rates are lower for salaried doctors than self-employed doctors
- Most banks allow you to prepay a part of your loan earlier than tenure
- Banks may also offer an overdraft facility for you
Eligibility criteria of loans for doctors
To avail of a professional doctor loan, one must qualify a few parameters like:
- You must be a salaried or a self-employed doctor
- If you are a self-employed doctor, you should own a hospital, general, dental, or eye clinic, or a nursing home
- You should be between 22 and 60 years of age on that day
- You should have a steady income of at least Rs. 15,000
Listed below are some preferable educational qualifications expected of a credit applicant:
- You must have an MS, DM, or MD degree for a super-specialist doctor
- An MBBS degree is obligatory for doctors who are practicing
- BDS and MDS are the degrees acceptable with dentists who are practicing
- You must have a BAMS or BHMS degree in favor of an Ayurvedic or Homeopathic doctor
- In case of a Homeopathic doctor, you need a DHMS degree
Following are a few requirements by your medical practice:
- To avail of a loan for doctors, you should have at least one year of experience in medical practice
- Loan for doctors can only be availed if you have an IMA membership or other medical registrations
To get a professional doctor loan, you should have filled Income Tax Returns for a minimum of 2 years. Moreover, you should have a minimum CIBIL score of 750 to avail of your loan. If want to apply for say, a loan against a property, you should have owned the property for at least 3 years.
You must meet all the eligibility criteria to be able to avail of your loan. Talk to a bank official to know further details about the bank’s requirements.
Documents required for a doctor loan
The important documents that are necessary for loans for doctors are listed below:
- You need to submit proof of identity such as a Passport, driving license, or PAN card
- Provide an address proof, like your Ration card, telephone bill, or the rental agreement
- Property ownership proof such as Property tax bill or the sale agreement
- Submit your bank statement or your bank passbook for at least 6 months
- Provide a few of your latest tax returns to get your doctor loan
- Give proof of your income like your salary slip for at least 3 months
- Educational proof for doctors are degree certificates and medical registration
- Provide proof of medical practice like establishment certificate and copy of tax registration
- Fill the application form as per requirement
- Provide recent photographs if needed
Doctor loan application procedure
Applying for a single loan for doctors comes with a multi-step procedure. The application for a doctor loan can be done through online and offline modes. Get your loan pre-approved with our feature specially designed for doctors.
Online application of loan
You may apply for a doctor loan online on the bank’s website. You need to visit the bank’s website and browse the doctor loan section. You need to download the online application form for your loan. Fill in your details and provide all necessary information. you may have to upload documents like your PAN card.
Then, enter the OTP (One-time-password) which will be sent through a message on your phone number. You may be asked for further information, like degree specialization or current EMIs. Submit your filled data.
Then, you will see a list of the bank’s offers for the doctor loan. Select the offer that you think is the best. Now all your details are ready for submission. Double-check all your details before proceeding to submit. Voila! Your application process is completed.
This process may be done from the comforts of your home and without having to step outside. A sales executive will call from the bank to help with the further procedure.
Offline application of loan
It is a standard method of applying for your doctor loan is to do so at the bank. One may download the application form or get it directly from the bank. Banks issue physical application forms or offer a digital form that can be downloaded and filled.
Since these loans are collateral-free, just submit the necessary documents along with the filled application form. Attach copies of all proofs like PAN card, income tax returns, etc.
This is the most crucial part. Ensure that there are no mistakes in your form and attach photographs if needed. Remember that one is expected to qualify for the loan application. Hence, ensure you have the necessary education and experience. Check if there are any missing proofs or certificates.
Common interest rates of loans for doctors
A doctor can be availed at a reasonable interest rate in India. Following are the interest rates of the different types of loans:
Personal loans come with a comparative interest rate starting at 9.25% up to 17%. The bank may also charge a processing fee of 2% and a document fee of Rs. 2000 of the total loan amount. Moreover, 4% of the outstanding amount may be charged as a maintenance fee.
The banks may charge an interest rate of 12-14% on business loans. In case of cancellation, the bank may charge Rs. 5000 and interest for the utilized period. The processing charge is usually 2% and the prepayment fees will be 4% plus taxes.
A home loan appears similar to a personal loan. However, the amount received for a home loan is a lot more. The rate of interest usually applied on housing credit is 5% to 17%. People use this money to build their dream house or renovate their house.
This loan avails the benefit of transferring the balance amount to other needs like your children’s higher education. This comes with competitive interest and a top-up amount. Moreover, this loan is pre-approved for doctors.
Loan against property
These loans are a safer measure to steer clear of debts. The banks charge interest rates starting at 12.5%. The document processing charges are about Rs. 2000 plus taxes. Additionally, a property insight fee of up to Rs. 6999 should be paid.
The interest rates may vary depending on your scheme of loan and your bank. Gather the details about interest rates in multiple banks, before making your decision. Go through their offers and choose a suitable scheme with a reasonable interest rate.
Things to bear in mind while applying for loans
Remember a few things while applying for a loan to ensure that the process goes trouble-free and quick:
Choose your bank cleverly
Make sure to do your research before availing of the doctor loan. Compare the interest rates and sanction speeds of multiple banks. Identify a bank with a high-speed service and the lowest rate of interest.
Speak with a sales executive in your bank to know more about their offers. Try negotiating with them and conclude wisely. Apply through online bank portals to obtain cheaper deals and lower processing fees.
Improve CIBIL score
The CIBIL is a parameter for your credibility as a borrower. If this score is low, your bank might not have faith and reject your application for a loan. A higher score improves the chances of it getting approved. A minimum CIBIL score of 750 is mandatory for doctor loans.
Take only what will be repaid
Decide an amount which you will be able to repay in your future. Do not borrow more than your capacity to repay. This may cause your life to revolve around debts. Moreover, it arouses doubt and can lead to a rejection of loan applications.
Avoid multiple applications
Whenever a person applies for credit, their query is captured in their credit report. So, applying for multiple loans may arouse doubt among lenders. On a whole, this makes one look like they are hungry for loans. Avoid doing this to ensure your loan approval.
Practicing medicine with a minimum of 3 years’ experience can ensure approval of your credit application. It is applicable for both salaried and self-practicing doctors.
Uphold proper financial records
GST registration is crucial for all businesses. Moreover, maintain audited proof of all your monetary transactions. This clarity will help your lenders to understand the flow of money in your accounts. This ensures that you are on the safer and clear side concerning your financial statements.
A doctor’s loan helps medical practitioners realize dreams in their profession and expand their business. The loan amount may be used to achieve tremendous heights in their business and practice. The purpose of this credit may be anything.
Be it personal or professional, this doctor loan will be a piece of cake. Obtaining this loan comes easy and takes almost no time. There is plenty of time to repay and its interest rates are attractive. Furthermore, there are plenty of benefits and loan options to choose from. Do your research and jump into it right away!