A personal loan has always been a great friend in times of need. This can be used for almost any purpose. While taking a personal loan can be an expensive idea however they are sometimes the best option over other available options.
Here are the important reasons when a Personal Loan can help during an emergency:
Medical Emergencies: This is one of the top reasons when people apply for a Personal Loan in case of emergencies. In todays world, cost of healthcare is rising in such a way that it becomes difficult for us to repay the hospital bills. These bills exceed the medical cover or health insurance plan. Also, these bills become challenging for those who do not have any insurance plans for elderly patients. In such instances, where people fail to pay their medical bills, an instant personal loan is of great help. If you apply for a personal loan through digital channels, you will receive the money in your bank account instantly which can be a lifesaver for you.
Wedding Expenses: Most of the times, wedding expenses go beyond our planned budget considering the fashion and style changes which happen in the current times. When these expenses are high, there is a possibility that you may face a financial emergency. In such times, personal loan can save our lives.
Consolidating your Debt: Credit Cards that carry high interest rates or other existing personal loans which you may have can be a difficult thing to manage over time and can put a financial stress on you. When you have an outstanding balance on your credit cards with high interest rates, taking out a personal loan to pay them off could save your money. In case when you have a very less time to repay your loan, personal loan can be of great help which would help you in crisis. Also, there would not be any default on your credit score.
Improving your Credit Score: When you take out a personal loan and pay off all your monthly instalments on time, this could improve your credit score. Also, your credit report is a good report when you have a mix of credit card and personal loan. In case you are handling different types of loans properly, this would add to your credit report.
Education Expenses: These days, people send their children to a foreign university for higher studies. We all understand that not everyone can afford the fees of big institutes or universities. To pay the fees, you can easily apply for a personal loan and your child can proceed with his education course. Also, education loans which carry high rate of interest, you can opt for a personal loan to fund your child’s education in India or abroad.
Home Repair or Renovation or any big purchase: Home renovation may not be an emergency, but there are times when your home needs an emergency repair. As we all agree that there are times when you have damaged wall, some parts of the home area may be in an urgent need of repair. Such repairs cannot wait for the weeks; hence you need emergency funds where personal loan can be an instant help to pay for such repairs. Also, if you’re buying home appliances, Furniture or any other big purchase where taking out a personal loan could be cheaper than financing through the seller or on credit card.
Please note that personal loans are not cheap, and they can be useful, given the right circumstances. Before you avail personal loan, you will want to consider the other available options which can be less expensive. When you finalize your decision on any lender, do compare with various banks or NBFC’s and take an informed decision. Check for interest rates, Processing Fees, Prepayment charges, Loan Term etc., these are basic things which one should consider before applying for a loan.