A personal loan is one of the most popular types of loans. The reason behind it is the simple eligibility criteria and easy loan application process. Earlier availing a personal loan was a tedious process that needed a number of branch visits and innumerable documents. It used to take a really long time because you had to fill out the form and traditionally complete the procedure. But now, with the help of the instant loan app, you can get your loan approved within minutes.
In contrast to other kinds of loans like home loans or car loans, personal loans are not specified for a particular use only. You can use a personal loan for any purpose ranging from medical expenses to travel to home renovation. You can take care of all your big and small expenses with the help of an instant personal loan. If you want to make a large purchase but lack the necessary funds for it then a personal loan could be your perfect solution. To affirm that, here are the various reasons why you should take a personal loan for your big expenses.
Reasons Why Personal Loans Are a Good Alternative for Your Big Expenses
Here is a list of reasons why personal loans are an excellent choice for financing a big-ticket purchase.
1. There Is No Risk to Your Asset
A personal loan is an unsecured loan, which means there is no need for collateral, and it is granted to you based on your credit score,borrowing history, and income. In simple words, a personal loan potentially gets you a loan from ₹50,000 to ₹1.5 lakhs without putting your assets at risk. The only thing that is required is for you to have a good credit score and a regular stream of income that can guarantee timely repayment of the loan.
2. Versatile in Use
Personal loans are generally not restricted to one use only.Post-approval of a personal loan you are free to use your loan amount for whatever purpose you want. You are not obliged to answer your lender about where you are going to spend your loan money as long as you are paying the EMI on the specified date. As for the uses of a personal loan you can use it to renovate your home, cover medical expenses, buy expensive devices, study abroad, finance a small business, or you can also clear your previous debts.
3. Flexibility in Repayment
As a personal loan is disbursed quickly post application, it aids you in fulling your immediate large or small financial needs. When you apply for a loan via the instant loan app, it will ask you to select the loan amount and time period according to which your EMI is decided. The loan repayment period is quite flexible ranging from 6 months to 24 months. The flexibility in the repayment period allows you to repay your loan comfortably without worrying about high monthly payments. The trick here is that the longer the tenure, the lesser the EMI amount, and the shorter the tenure, the higher the EMI amount.
4. Simple Eligibility Criteria and Application process
In contrast to other types of loans, a personal loan requires little documentation with simple eligibility criteria. Most lenders consider basic criteria for eligibility like your age, type of employment, annual income, citizenship and your credit score. For verification, you have to submit KYC information like age proof, residential proof, and identity proof. With the integration of technology in the service sectors, now the application process has become completely paperless. You can now apply for a personal loan digitally via an app where your loan is processed and approved within a few minutes.
5. Boosts your Credit Score
Though you may not pay much attention to this part, a personal loan is a great tool to improve your credit score. Whenever you take out a loan and make timely repayment of your EMI it is taken by the lending institution as good faith, proving that you are a prudent borrower. This results in a significant increase in your credit score. Furthermore, an unsecured personal loan diversifies your credit profile, demonstrating your ability to manage different types of credits appropriately. When your regular repayments are combined with your previous debt accounts it overall improves your credit score over time, opening a gateway for you to get personal loans quickly and easily in the future.
Personal loans are the best financial aid for big expenses, both planned,add unplanned. Whether it is a high-end mobile that you are planning to buy or an unforeseen medical expense that strains your savings, going for a personal loan seems like the best solution. With easy processing and competitive interest rates, it is easier than ever to have the necessary funds at your disposal. You can download a trusted instant loan app and fulfill your emergency cash needs in just a few clicks.
However, before applying for a personal loan, please bear in mind that you should have a good credit history and your income to debt-ratio should be balanced. Also, spare some time in research to find out the best deals on personal loans.