A personal loan is a versatile financing tool that can come to your aid in a financial crunch. Be it debt settlement, substantial expenses, or an unanticipated financial need, a personal loan can fulfill your financial needs without questions. With features like simple documentation, easy eligibility, instant disbursals, flexible repayment and affordable EMIs, a personal loan has become the most preferred financial tool. Today, you can avail a personal loan by simply downloading the best loan app.
Just a few taps on the mobile and an instant loan would be disbursed into your account within hours. A loan app is the best choice when it comes to small ticket loans. For big ticket loans, you can opt for personal loans from banks or NBFCs. But before you apply for a personal loan to cover a large expense it is crucial to understand its feasibility.
Check out the top reasons why you should take out a personal loan to cover large expenses –
Top Reasons Why You Should Take Out a Personal Loans to Cover Large Expenses
Here are the top six reasons to justify why taking out a personal loan to cover your large expenses is the best option.
- Personal Loan Provides You Instant Funds
A personal loan can come handy to cover your large expenses in case of emergencies. For example, if you are urgent need of funds for a medical emergency or home renovation, then availing a personal loan can be your best option. Most financial institutions process your loan application within hours of application.
Though ideally an insurance policy should take care of such expenses, but at times, you might find yourself in dire need of cash while dealing with such an unforeseen cost. This may be because claim settlement needs time, or your insurance does not provide complete coverage. As such, applying for a personal loan can be your best choice.
- You Don’t Have to Break Your Savings to Make a Large Expense
Whenever we have to make a large purchase, the first choice is often breaking your investments or liquidating your assets. But availing a personal loan to accommodate such expenses can be a cheaper option then selling your property or breaking your investments. If the interest earned on your investments is greater than the interest on a personal loan, then you should consider availing a personal loan rather than breaking your investments.
Also, the value of property multiples with time, so selling your property to accommodate big expenses can cost you big time. Whether it is your wedding expenses, education expenses, home renovation expenses or any other expenses, an instant loan can help.
- Repay According to Your Convenience
Paying for a big expense upfront can seem like a big burden. You might either have to break your investments or put your assets at risk. But with a personal loan, you can take care of your large expenses with ease. Personal loans, today, comes with many features, one of which is repayment according to your own convenience.
You can choose the loan tenure and the EMI payment due date, according to your convenience. This helps you manage your monthly budget with ease. You can also use a personal loan app EMI calculator to estimate your EMI amount by entering your loan interest and amount. This tool provides you with the most crucial information regarding your loan EMI beforehand so that you can make smart financial decision.
- Personal Loan Application Process Is Very Easy
Most lenders have streamlined the loan approval procedure due to the rising demand for personal loans. Obtaining a loan is simple as long as you comply with the lender’s eligibility requirements and provide the necessary documentation. If you qualify for the loan, then the lender would disburse the loan amount with 24 to 48 hours. This makes it more feasible than most other financial instruments.
- You Don’t Have to Give Up Your Assets to Get a Loan
A personal loan is an unsecured loan, which means unlike other types of loan. This means, you do not need to put up your assets as collateral for a personal loan. Also, when you apply for an instant loan, you are not required to have a guarantor. As a result, a personal loan makes it quite simple for you to receive a loan and get approval easily.
While for availing any other type of loan, you will either need collateral or a guarantor. A personal loan is offered solely based on your monthly income and credit report. The lender relies on your repayment capability and your credit history. This safeguards your assets even in case of loan default. But do remember that defaulting on your loan can impact your finances poorly.
- Personal Loans Eligibility Criteria Are Quite Simple
Lastly, a personal loan has the simplest eligibility criteria. Most lenders consider your age, occupation, income, citizenship, and credit history. The majority of lenders have their own standards for accepting loan applications, but most of them check these parameters. You will get approval for a personal loan more easily, if you have a stable employment with a reputed employer.
Conclusion
A personal loan can be your best choice when it comes to managing your finances. Whether, you need a big-ticket personal loan for your wedding expenses, or education expenses, to start-up your business or to renovate your home, a personal loan can accommodate these expenses with ease. A personal loan can also help you meet your medical expenses in all cases where your health insurance falls short.
Thus, applying for a personal loan to cover big expenses can be a smart idea. Especially, if the expenses are unavoidable and the alternate options you are considering are more expensive. For example selling your flat or land, or liquidating your investments can cost you more. Make sure to make these calculations before applying for an instant loan.
Despite being a great method to pay for large expenditures and consolidate debt, personal loans should always be used with caution. Personal loans may help you achieve your financial goals, but only if you plan to use and repay them properly. To know if taking out a personal loan is a good choice, you can use the personal loan EMI calculator. This will help you make smart financial decisions and manage your finances well.