Why Personal Loans are an Excellent Choice for Financing Needs
Banks and financial institutes give you credit based on your credit behaviour, repayment history, and credit score. Given this benefit, a digital personal loan via a instant loan app or website is a reliable option if you don’t want to risk your asset and get immediate funding.
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FollowToday, many Indian borrowers rely on personal loans for their benefits and easy-to-meet eligibility criteria. Moreover, due to increasing demand, lenders are now making personal loans more accessible via their loan app or website.
Personal loans are a quick solution to cover many financing requirements, from meeting emergency cash needs to improving your credit score. Depending on your needs, you can get a long or short term personal loan and repay comfortably without straining your finances.
You can also get a loan for a few thousand rupees to a few lakhs, making it a viable option for both small and big-ticket expenses. All you have to do is visit your chosen lender’s instant loan app or their website and fill in the application form.
Read on to know more about the benefits of a personal loan that makes it an excellent choice.
Acquire Collateral Free Credit
Unlike a home, bike or gold loan, a personal loan is an unsecured type of credit. This means, you can get a long or short term personal loan without having to pledge any of your assets.
Banks and financial institutes give you credit based on your credit behaviour, repayment history, and credit score. Given this benefit, a digital personal loan via a instant loan app or website is a reliable option if you don’t want to risk your asset and get immediate funding.
Enjoy Lower Interest Rates
When applying for any loan, including personal loans, you need to pay a cost in the form of interest. This cost depends on the interest rate you get from the lender. Generally, long or short term personal loan comes with competitive interest rates.
With a lower interest rate, your borrowing costs are more affordable. To explain this with an example, consider that you take a short term personal loan for ₹1 Lakh for a year at an interest rate of 10.49% p.a. Here, your EMI comes to ₹8,814, and your interest payout comes to ₹5,773.
On the other hand, if you take the same loan at an interest of 11.99%, the EMI comes to ₹8,884, and the interest payout comes to ₹6,613. While the difference may seem marginal, it increases as your amount and tenure increase.
As such, lower interest rates make personal loans more affordable. The affordability also helps ensure you don’t strain your finances at any point and meet your needs without any stress.
Get Quick Access to Funds
With a personal loan, you can get your funds quickly without visiting the lender’s branch. Since it is an unsecured loan, lenders don’t need to verify many things, which is the case when applying for loans with collateral. All you have to do is head to the preferred loan app or website and complete the application process.
The application generally requires minimal information. Given this, many banks, NBFCs, and financial institutions have a shorter processing time and disbursement period. This gives you quick access to funds.
In fact, many lenders even offer a transfer of funds within hours. This makes a long or short term personal loan a reliable option, especially during an emergency.
Utilise Funds Without Restrictions
Getting a personal loan means you get the funds with no end-use restrictions. This means you can get a loan to satisfy any financial requirement. Moreover, lenders now offer high-value funding, going into lakhs of rupees.
As such, you can meet big-ticket expenses, such as refurbishing your home, education costs, overseas travel, wedding, down payments, and more. Moreover, high-value funding ensures that you can get what you want without compromising on any front.
A crucial point to remember here is that you must ensure that the repayment tenure allows for an EMI that fits in your repayment budget. Do not opt for a short tenure to maximise on savings, if you can’t afford the higher EMIs. Similarly, do not opt for a longer tenure, if you can comfortably handle a higher EMI.
Applying for Credit is Easy
Thanks to the digital application process, you can apply for a long-term and short term personal loan from trusted banks and NBFCs, online. To get a personal loan, you can apply on the lender's website or the loan app with minimum documents, and get quick loan approval.
However, assessing your eligibility before applying for a long or short term personal loan is important. Thankfully, the criteria are basic and generally include the following:
- You should be an Indian resident
- Your age should be between 21 – 65 years
- You should have a stable source of income and minimum income as required
- Your credit score should be good, generally above 750
Once you meet the eligibility requirements, you can apply for a personal loan with those lenders and get easy funding. Moreover, if you have good creditworthiness and eligibility, you may even qualify for a pre-approved personal loan.
Pre-approved loans come with a relatively shorter turnaround time as the lender has already verified your information. You can check your pre-approved offer via the lender’s loan app or on their website.
Repay with Flexible Options
Since different expenses may require different loan amounts, the repayment plan and amount will vary. Thankfully, a personal loan not only gives the flexibility to cover all your expenses but also multiple options to repay as per your finances.
You can decide on a suitable tenure using a personal loan EMI calculator to help with the timely repayment of your personal loan. Depending on your requirement, you can take a long or short term personal loan.
If you can afford a higher EMI, a short term personal loan will help you close your loan with a lower tenure. With a long-term personal loan, you can have more affordable EMI. However, remember that with a long tenure, the interest payout will be higher and vice-versa.
So, take into consideration your total cost and compare it with other offers to keep your costs and EMI within budget.
All in all, a personal loan is a pocket-friendly option when you need financial help. After weighing your needs and repayment capacity, you can apply for a long or short term personal loan.
Thanks to the fintech advancements, you can apply for a personal loan via a loan app or website in a matter of minutes. Moreover, the application is paperless, making it easy and simple. This way, you can get the funding you need quickly and without any hassles.
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