Personal loans are a great way to manage your finances and helps to transform your plans into actions even when you lack funds. The usage of personal loan varies from person to person. Some might need it to pay off an existing debt whereas other might need to plan a vacation or fund a child’s education fees. The best part about a personal loan is that they are used for varied purposes. Unlike home loans, wherein you have to submit a collateral and notify the financial institution for inspection, personal loans are quite easy to obtain.
Personal loans also called as multi-purpose loans are easy loans where your lender cannot question your intent. However, considering that you are going to use it optimally, here are five instances where you might need a personal loan. If you are facing the situations which are mentioned below, feel free to approach a Non-Banking Financial Company (NBFC) to help you ease your troubles.
- Consolidation of Debt: Some people have numerous outstanding debts on their heads. These debts include home loan, car loan, credit card bills and so on. With the help of a personal loan, you can consolidate all your debts into one single loan. It is an excellent way to save money as it will provide you with a single rate of interest which is much convenient than multiple interest rates which are much higher. Lower interest rates will help you to save significantly.
- Home Improvements: It is not just the festival vibes that push us to undertake a renovation. There are many instances and urgencies wherein you need to improve your home. However, the cost of home improvement is high and most of the times savings are not enough to make up for it. Thus, when it comes to remodelling your kitchen, or refine your interiors, where you need high amount, you can apply for a personal loan to make your house, a dream house without financial constants.
- Medical Bills: Many times, people overlook crucial medical procedures because they lack funds. As sad as the sacrifice is, it can take a heavy toll on one’s life. In such a situation, it is essential that steps are taken, and that could be done by availing a personal loan. Thus, when it comes to arranging cash in an emergency, you do not have to drain your mental and physical energy in arranging the cash.
- High-End Purchase: Many of us dream of buying a high-end gadget but restrain thinking that it is beyond our financial capabilities. However, with the kind of services we have around us, there is no need to sacrifice. One can simply borrow a personal loan and buy the high-end product he/she needs and comfortably repay the personal loan amount over a particular period of time. Budget friendly EMIs does not hurt your wallet and can make you live your dreams as well.
- Wedding Expenses: Indian weddings regardless of the event are an extravagant affair. A huge cost is involved in breathing through this process. If you analyse, petty amounts such as the cost of the venue, catering, decoration, jewellery, photography and clothing all add up to make one gigantic sum. However, you do not have to worry. Simply approach a highly-rated Non-Banking Financial Company (NBFC) and glide through the wedding expenses with ease.
What if you have a bad credit score?
Well. Yes, to apply for a personal loan, you do need to have a good credit score. A good credit score is the one which is above 700. However, there are several things you can undertake to improve your CIBIL score. Banks and NBFCs offer personal loan even if you have a less than good credit score, but it may be at a higher rate of interest.