Do you know that a personal loan can be used for several purposes, besides buying big-ticket items?
The advantages of opting for a personal loan are boundless, only if you are aware of how to effectively use them. Besides funding your wants and needs, they even provide an excellent way to bridge your cash flow mismatches and form your credit score (only if you follow disciplined credit behaviour i.e., timely repay the EMI in full).
What’s more, they do not need any security or collateral. You can expect quick loan disbursements from lenders without the requirement for lengthy documentation. The best part is you just need to hit on the personal loan apply online button on the lender’s website or app to avail the loan. This eliminates the need to personally visit the lender’s branch to submit the personal loan application request.
Check out the 5 scenarios wherein opting for a personal loan is recommended –
- Consolidating debts
Are you one of those who spend more than your repayment capacity on credit cards? Well, in such cases, a personal loan may be the best route to get you out of the debt trap. This is because personal loan interest rate is usually lower than the credit card’s finance charges. However, a word of caution – remain responsible and prudent with repayments after consolidating your debts or else you may witness a bigger pile of debt.
- Medical exigency
Medical exigencies can hit any time and in differing degrees of magnitude. At times, they may rattle all your bank balance. In such circumstances, opting for a personal loan is recommended. This is because personal loans require minimal paperwork, and you can apply for it from anywhere and at any time.
To apply for a personal loan, you just need to compare amongst different lenders based on the offered interest rate, processing charges etc. Once you have zeroed on the suitable medical emergency loan, hit on the personal loan apply option.
- Funding a purchase
Are you short of funds for your vacation? Do you want to purchase the latest gadget, but the price scares you? With a personal loan, you can realize all your dreams. The best thing is lenders have relaxed eligibility criteria for personal loans and seldom require any reason to avail them. Also, you can set the repayment tenure as per your flexibility. The personal loan tenure ranges anywhere between 1 and 5 years.
- Funding child’s higher education
While education loan exists to fund a child’s higher studies, few lenders may not be willing to finance your child’s travel, living and transportation expenses during the study period. In such scenarios, a personal loan is an ideal avenue. This avenue can be used to fund your child’s miscellaneous expenses.
- Business funding
Inadequate funds are one of the hurdles that slow your business growth. Here in this case, you can opt for a personal loan to alleviate your cash flow issues and recoup your business.
Ending note
Features like the requirement for no collateral or security, fast processing, no restriction on funds end usage etc. make personal loans one of the saviours that can help you face tough situations with ease. Nowadays, preapproved personal loans are also available, which can be disbursed on the same day of submitting the loan application. However, note that before availing a personal loan, ensure to use a personal loan EMI calculator. Using an online personal loan EMI calculator will allow you to compute your personal loan EMI and repayment tenure as per your cash flow and repayment capacity.
