5 Situations Where a Personal Loan Can be Useful
A shortage of cash may hit you at times when you require them the most. You may also not want to utilise your savings, as it will leave you with nothing for the future.
In such a situation, a personal loan can be a feasible choice. These loans can give you the cash you need. These loans are exceptional financial solutions during crisis as you can avail them within 24 hours.
Your loan application can be approved within 5 minutes and the funds disbursed to you under 1 working day. Neither do you have to provide collateral nor do you have to furnish a heap of documents.
The application process is straightforward which makes availing these loans even more accessible.
Now, you have a loan that you can put to any use. Some of the ways personal loans can be used include:
1)For financing Higher Studies
Funding higher studies is one of the premier uses of these loans. As the cost of education continues to rise, so does the number of students that go for abroad studies.
Both of these situations require extensive investment for which parents opt for these loans. The attractive personal loan interest rates make this product a great choice when going for higher education.
2) When Arranging a Grand Wedding
Hosting a grand wedding is always a priority for individuals irrespective of what strata they belong to. For both the middle class and upper class, arranging funds for such marriages can be troublesome at times.
Hence, many a time, they opt for external funding and these loans are one of the preferred choices. These loans have tenures ranging from 12 to 60 months which makes repayment more flexible.
3) For consolidating debt
The personal loan eligibility criterions are easy to satisfy. This helps you avail them quite easily, which they can use to consolidate existing debts. Both salaried and self-employed individuals apply for these loans for paying off their debts.
Such individuals can find themselves in debt from credit cards, suppliers, and other lenders. Hence, you can also opt for these loans in case you have found yourself in a pile of debt.
Some of these debts upon consolidation can come with higher interest rates as compared to these loans. So, you can utilise these loans for refinancing. Refinancing is a method of taking out a loan with lower interest rates from one lender to repay another one with higher interest rates from the current lender.
Thus, your EMIs become cheaper, and your repayment is made even more comfortable.
4) For Medical Emergencies
As mentioned above, these loans can disbursed to your bank account within 24 hours. So, many individuals take advantage of rapid disbursal and use these loans for medical emergencies.
You can take a look at your pre-approved offer by furnishing only your essential details.
These loans can provide funds up to Rs. 25 Lakh. They can be your financial solution in case you don’t have ample cash in hand.
Similar to higher education, the cost of healthcare is also seeing a gradual rise for which lenders customise these loans for the latter to use.
5) When your home needs a makeover
Your house will need a makeover when it has crossed the 10 – 12 years threshold. You have to maintain the “dream abode” tag of your home as you initially intended it to be. Furthermore, keeping up with changing trends is a necessity to walk shoulder to shoulder with others in your locality.
Lenders provide these loans specifically for such causes and to help you give your home a makeover. Not only this, but you can also utilise the amount to construct a new floor, add a new garage, etc.
These were the 5 situations where personal loans can help you. Follow the guide mentioned below to know how you can apply for the same.
How to Apply for a Personal Loan?
- Have a credit score of 750 or above
A credit score of around 750 is one of the obvious unsecured personal loan eligibility criterions that you must fulfil.
- Furnish all the documents
You need to furnish your KYC documents, address proof, bank account statements, income tax returns, salary slips (salaried), audited business turnover (self-employed), and proof of business.
- Fulfil the eligibility criteria
You have to be between the 23 and 58 years of age and employed with a private/public company or MNC. Or, you have to be between the ages of 22 and 55 years and have a business with a vintage of at least 3 years.
These were primarily the three requirements that you have to satisfy to apply for a personal loan.