Seamless And Quick Loans For Meeting Personal Expenses

Unplanned expenses are not called for. During these times it is important to have timely access to funds to meet personal expenditures that demand urgent action. Instead of depleting personal savings, quick loans in the form of personal loans from banks or NBFCs can be a perfect financial solution. Unlike home loans or car loans, these loans are not secured by any collateral.

For personal loans, lenders do not restrict users with any designated purpose for which the funds cannot be used. In fact, personal loans can be used for anything and this is what makes it one of the preferred choices for many individuals.

Like any other loan, this type of loan can be paid back in monthly installments over the course of a few months or years. Most banks and financial institutions offer personal loans at fixed interest rates. It means that the payments will stay the same every month.

A personal loan can be used to consolidate all the outstanding balances into one monthly payment. That being the case, it may be wise to substitute and pay off all high-interest debts, like that of credit cards, into a single payment by taking a personal loan with a lower interest rate.

Personal loans are fast. The approval time is less and banks usually disburse the money to the borrower's account within a few working days. So, they may be ideal for meeting any emergency expenses like medical treatment, moving costs, etc. Another advantage of personal loan is that it requires no security. So, people who are not comfortable pledging their personal assets can borrow personal loans from banks to finance any personal costs like home repair or upgrade work that involve less money.

How To Make Personal Loans Affordable?

In the past few years, India has witnessed a tremendous increase in the number of personal loans. They are multi-purpose loan having its own set of advantages and disadvantages. To make the decision of personal loans a reassuring experience, one should follow the right steps. That said, the first step towards it is to build a good credit score. A good credit score helps to get competitive interest rates from a lender.

Personal loans are usually offered on the income of the borrower. Like any other loan, the principal amount along with the interest must be returned to the bank. Lenders while sanctioning a loan request application assess the repayment capability of the applicant based on several factors. So in addition to the regular salary or business income, one must always disclose all the income sources to the lender for a robust credit profile.

Another way to secure the loan at a better rate is to apply jointly with a co-applicant. The co-applicant provides an added level of guarantee in case of a loan default and also adds to the overall eligibility of the loan.

The process gets all the smoother for those who decide to go online. These loans have pre-defined charges with no hidden charges.

When To Avoid Personal Loans?

Personal loans are easy to get. Most banks have easy documentation prerequisite and short approval process for personal loans. But sometimes in some situations personal loans may not be the ideal choice for funding expenses. They are as follows:

• Low Credit Score:

Personal loans carry greater risk for lenders. To recoup their losses due to a loan default, most banks charge high rate of interests. Since the interest rate offered varies from bank to bank and also for applicant to applicant, a lower credit score can further increase the interest rates.

• Better Alternatives:

Personal loan can be a bad choice if the amount involved does not give any fruitful result. Home loan, educational loan, vehicle loan, etc. that are specifically designed to fund a particular expense, come with many benefits. So, choosing personal loans over better loan alternatives that offer lower interest rate and affordable loan terms may not make sense.

It must be recollected that personal loans are short term loans, typically stretching for a period of 12 to 60 months. Consequently, they can be riskier for those with an unstable job.

Conclusion

Unplanned expenses can put a great amount of strain on finances. In such situations getting a personal loan can be a good idea. But like other loans, it is expected to be paid off in EMIs with interest to the lender. As a result it is advisable to apply for a personal loan only with a stable income and a good credit score.

There are several banks and NBFCs in the market that offer personal loans. For the best deal a comparative study of the lenders is necessary before finalizing the lender.

If you are looking for a quick financing solution, IIFL Finance may be a good choice. IIFL Finance personal loan can be taken to cover a wide range of personal expenses such as marriage, purchase of consumer durables, travel, holiday, etc. All IIFL Finance personal loans are unsecured loans. However, if you wish to lower the interest rates you may secure it with a collateral.