Despite our efforts to cut expenses, maintain financial discipline, and save money, we need additional funds to meet financial obligations that can’t be postponed. Earlier, seeking financial help from friends, relatives, and associates was quite common. But nowadays, due to instability in the job market, reduced or irregular income, low savings, many people refuse to offer financial assistance to needy people. That is why personal loans seem like a lifesaver for many individuals. Salaried and business people apply for online personal loans from time to time. It helps them get the much-needed money and comfortably manage all small and big purchases. But is it wise to take personal loans when you have urgent financial obligations and no one to help you? Let’s discuss the matter in detail.
Significant Advantages of Instant Personal Loans
India’s market is heavily flooded with different loan products. But online personal loans stand out from the crowd because of their excellent benefits. Some significant advantages of the loan are detailed below-
The Availability of Abundant Loan Amount
Personal loans are pretty popular among a large number of borrowers in India. Credit lenders promise to offer abundant loan amounts to all eligible candidates. In general, different banks offer different loan amounts. In general, applying for instant personal loans allows you to receive funds from Rs 50000- Rs 5000000. You won’t believe it, but banks in India are ready to offer personal loans to all eligible candidates for almost all essential expenses. So whenever you feel the need for additional money, applying for online personal loans allows you to quickly get hands-on the much-needed cash. It acts as a lifesaver when you are totally out of money and have some urgent expenses.
No Collateral Requirement
Traditional loans available in India are backed up by collateral. Banks and credit lenders ask borrowers to place their expensive properties as collateral against the money they want to borrow. Collateral placement reduces the risk of giving a new loan to the borrower. The bank reserves its right to seize the collateral if the borrower doesn’t abide by the loan repayment terms and conditions. But a large number of individuals in India live only on basic income. They don’t have expensive properties to use as collateral. Personal loans are a ray of hope for such people as they don’t include the collateral placement criteria.
Any employed person earning regular monthly income and can repay the borrowed money is considered eligible for online personal loans. Even self-employed people and business owners are entitled to these loans if they fulfill the basic terms and conditions set by banks.
Bank executives conduct strict background checks and verify the details of borrowers several times before making a final decision. Stable employment with a good company or organization, regular monthly income, a healthy record of expenses, financial discipline, an active bank account, excellent creditworthiness, and a good credit score ( between 700 to 900) may help you get approved for most personal loans available in India.
Plenty of Lenders
When it comes to taking personal loans, borrowers have the upper hand in the market. Almost all banks and credit lenders offer personal loans to customers. This works in favor of regular loan borrowers. They can scrutinize the offers of different financial organizations based on the availability of the loan amount, repayment tenure, general terms and conditions, interest fees, processing charges, late penalties, and other factors. This will help them choose an ideal personal loan suitable for their needs and budget.
Also Read : Common Myths About Personal Loan
Personal Loan Interest Rates: Do Some Research And Analysis
The interest rate applied on borrowed money is a concern for frequent loan borrowers. The less it is, the more it benefits people. Different banks offer personal loans with varying fees of interest. It would help if you did some research and analysis regarding banks’ interest rates when looking for personal loans. Generally, if you decide to take a personal loan from a government sector bank, you will pay fewer interest fees. But taking the same loan from a public sector bank is not easy. You will have to pay several visits to the bank, complete various formalities, and communicate with the bank manager several times to get your loan approved. All these exercises are unfruitful if you need money in a short time.
That is why many people turn to private sector banks for personal loans. One of the significant advantages of working with a private sector bank is that they allow you to apply for a loan from any location. Simple application methods, minimal documentation, and quick accomplishment of all the necessary formalities help you get the required amount quickly from a private sector bank. But they apply higher interest-free on the borrowed money. That is why experts recommend borrowers should compare the interest rates of personal loans offered by different banks and choose an affordable loan package.
Personal Loan Application Process: It’s Pretty Simple
Applicants can apply for personal loan online or offline. The online method of loan application is quite simple and convenient. You just had to visit the website of the chosen Bank, navigate to the application section, fill in all details correctly and click the submit button to send your application to the banker. If you are not comfortable with this application method, visit the bank’s nearest branch, communicate with the manager regarding your desire for a personal loan, and ask for an application form.
You need to fill-up the form with correct details and attach relevant documents with it. The bank executive will take your application and give you an acknowledgment slip. Online applicants get a token number to track the status of their loan application. A team of bank executives and loan experts will start verifying your application for the loan and may invite you for further discussion. You must submit the required document, answer all questions honestly, and complete formalities as per the standard protocol.
Bank executives will evaluate your overall income, monthly expenses, balance amount, financial obligations, the weight of existing debts, credit score, and other details before approving your application for the loan and finalizing the amount you would be getting as debt. Remember that out of a hundred applications; banks reject almost 78 borrowers due to multiple reasons. It may include requests for a hefty loan amount, insufficient income, frequent job changes, poor credit scores, the excessive burden of existing debt, criminal cases against the borrower, the lack of a co-borrower, etc.
Therefore experts recommend that borrowers not make unnecessary haste while applying for personal loans. They must analyze their actual need for additional money, get more information about the loan product and generate a request for it, including all details. An application that carries all information on the borrower makes it easier for bank executives to complete the required formalities soon and announce their verdict. If you have completed all the loan formalities and the bank considers you as an ideal credit borrower, chances are higher that your application is approved. After deducting the loan processing fee, the bank will transfer the agreed money to the specified bank account.
Extended Repayment Tenure and Pre-payment Facility
Extended repayment and pre-payment facility makes personal loans quite popular among frequent credit borrowers. Most banks offer these loans to people for one to five years. They allow you to repay the borrowed money in small installments. The good thing is that you don’t need to visit the bank several times to make the loan repayment. This process is automated.
You need to maintain a sufficient balance in your bank account so that loan repayment can take place successfully. Banks always appreciate credit borrowers who want to repay the borrowed money before maturity. They will demand some prepayment charges and settle the loan permanently. You have to place a formal request for the early repayment of the loan.
Management of Small And Big Purchase It With Personal Loans
Nothing is more awkward and disappointing when you have urgent financial commitments and a shortage of money. Therefore, online personal loans always come as a respite for struggling people. You can get the approved loan amount instantly in your bank account and use it to cover a wide range of expenses. Some of them are described here below:
Personal Loans For Foreign Tour
Touring foreign countries is a new trend among India’s affluent and middle-class individuals. But visiting a favorite tourist destination requires you to have a sufficient amount of money. So when you want to see a particular country, the cash shortage forces you to abandon your plan. Now it’s easier to take a personal loan for tours and travels. Depending on your income and financial condition, you can apply for any amount under the provision of personal loans and visit a dream destination comfortably.
Personal Loans For Buying Useful Commodities And Appliances
To lead a comfortable and healthy life, individuals need to buy a wide range of valuable commodities and appliances. If your income and cash reserves are insufficient for such a purchase, then taking a personal loan is always a wise decision. The bank will issue the requested loan amount after completing the required formalities in a few days. You can buy the most valuable commodities and appliances on credit and enhance the overall standard of your life. The remaining balance of the purchased item is deducted in several small installments from your bank account.
Personal Loans For Medical Expenses
Personal loans for medical expenses are a ray of hope for individuals who need additional cash to cover essential medical bills. It ensures the immediate availability of much-needed funds. You can use the received money to buy medicines, small medical equipment, pay for surgeries or operations, etc. The availability of such loans ensures patients get healthcare services on time. It helps doctors save precious lives.
Personal Loans For Marriages
We all know that organizing a marriage party is an expensive affair. You need to have lots of money to buy new clothes, make arrangements for guests, decorate the marriage venue, make sound and lighting arrangements, and cover several other expenses. All individuals want to make their marriage party more marvelous and worth memorable. But the shortage of cash is a significant issue for many couples. They can take personal loans for marriages and comfortably meet several ceremony expenses. Before generating a request for personal loans for weddings, evaluate your requirement for money. Take a loan amount that is sufficient for your needs, and repayment doesn’t put additional pressure on your monthly budget.
Personal loans for credit card payments
Many Indians (approx 64 million) use credit cards for various purposes. The availability of credit cards allows you to arrange the much-needed money in dire situations. That is why the number of credit card users increases by leaps and bounds with each passing year. The bank will impose penalties and take legal actions if you don’t repay credit card payments on time. Defaulting on credit card payments can spoil your credit score, which makes it difficult for you to get a loan in the future. With the help of personal loans, you can clear credit card payments in one go and feel relaxed. Timely payment of credit card dues improves your credit score up to a great extent and makes you a reliable person (in the eyes of banks and credit lenders).
Consolidate Your Debt With Personal Loans
In recent years, the demand for loans has increased in India. Many people take more than one loan to meet multiple financial obligations. Dealing with different banks and repaying all loans at the right time is challenging for most people. Many banks offer personal loans with debt transfer facilities. It allows you to consolidate all loans in one and pay off the accumulated debt to a new financial organization with reduced interest fees. Debt consolidation is an excellent way to get rid of many loans and avoid hassles dealing with different banks.
Personal Loans For Home Renovation
Personal loans for the home renovation are ideal financial aid for all those who need additional funds to make the required improvement in their accommodations. It is often called an excellent alternative to traditional home loans available in India. You have to prove your eligibility and meet the basic terms and conditions to get personal loans for home renovation. Then, with the help of received money, you can make minor home improvements, which can’t be avoided.
Personal Loans For Education
The cost of education increases by leaps and bounds each year in India. Many parents in our country don’t have sufficient money to finance the higher education of their sons and daughters. However, it doesn’t mean that their future generation can’t access higher education. Personal loans for education allow people to comfortably bear the cost of the higher education of their sons and daughters. Many banks offer personal loans for education with flexible terms and conditions and lower interest fees. Parents must research and analyze different offers before taking a personal loan for education.
A person may have different utility bills depending on his standard of life, habits, the location he is living in, requirements. Keep in mind that our sources of income are limited, but expenses are unlimited. Therefore, we need sufficient money to meet multiple requirements that pop into our life from time to time. A personal loan is beneficial if you have some urgent financial commitments and a cash shortage. Personal loan eligibility, terms, and conditions, payment tenure, processing fee, prepayment charges- all are suitable for average credit borrowers. You can use the borrowed money to meet multiple financial obligations comfortably and lead a happy life without asking for financial assistance from anyone. Happy borrowing!