If You Are Financially Broke, Personal Loan Can be Your Friend in Need

Updated on: 19 Jan 2024 // 5 min read // Personal Loans
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Financial worries never arrive with a knock. Just like seasons don’t remain the same, similarly, your financial health may not be the same. Given the increasing cost of living, even if you have a steady source of income, you may face financial problems. You may not be able to pay your credit card bills on time. You may need some emergency cash to meet certain needs. Your plan of renovating your home gets postponed. Other debt liabilities are only taking a toll on your financial health.

What should you do when you are broke? Borrow from friends and family? No! This is not a viable option. When you can Avail a Personal Loan, why worry. This is the loan that many individuals bank upon when they require a large sum urgently. The loan application process is easy. Irrespective of whether you need funds for an impending marriage, a medical emergency, debt consolidation or for any purpose, you can Apply for a Personal Loan and avail it within 7 days.

Here are reasons why Personal Loan can be your friend in need when you are broke financially:

Paying Your Huge Credit Card Bill

So, you have done some big shopping using your Credit Card on the occasion of an anniversary or birthday party to buy gifts. The huge Credit Card bill is worrying you as you are not able to pay it on time. Not paying on time will only affect your credit score. Besides, if you do not pay your full outstanding bill on time and keep on shopping, you will end up paying high interest charges. It is better to avoid paying high interest and Clear Your Credit Card Debt with a Personal Loan.

Often, the interest you pay on your overall outstanding Credit Card payment month after month may turn out to be higher than that of the interest rate levied on a Personal Loan. Thus, you not only save on interest rate but also get rid of your Credit Card bill burden.

Debt Consolidation with a Personal Loan

If you have accumulated debt on several credit accounts over several months, the worry of making payments on time may start affecting your financial health. Besides, if you have taken a loan, paying your EMIs (equated monthly instalments) on time may seem taxing. To add to the woe is keeping track of the various payments. Debt consolidation with a Personal Loan is a smart way of managing your debt without hassles.

Consolidating your debt involves combining the various balances into one single bill to be paid on a monthly basis. Thus you have only one payment to make every month on your various unsettled debts. Personal Loan is a viable solution if its interest rate is lower than the previous interest rates paid.

Settling Emergency Payments

Saving enough to meet emergency situations in life is always advisable. But this situation may not be the same for every individual. Even if you manage your finances smartly such as buying Health Insurance for your family, car insurance, etc, unavoidable situations may arise for which you may need emergency cash. For example, a family member faces a sudden medical emergency that requires hospitalization and it is not covered in your Health Insurance Policy. Your car may need an immediate repair which is not covered in the car insurance. Such emergencies cannot be postponed. What will you do in such a situation? Take a Personal Loan!

Home Renovation

A festivity, a big family function or a marriage occasion in your family is around the corner. So, you need a considerable amount of money to renovate your home. Have you applied for loan for home renovation? If yes, is the money sufficient for the task? If no, you can take a Personal Loan to meet the additional expenses. Even if you have not taken any loan for renovating your home, you can take a Personal Loan for this purpose. Ensure that you set a budget for the renovation expenses so that you don’t add to your debt. A Personal Loan is also a debt. Hence careful spending will help you not to get trapped in the big debt cycle.

Avoiding Withdrawal of Emergency Cash

Do you know the interest levied in cash withdrawal from a Credit Card is higher compared to a Personal Loan? Besides credit card lenders charge an additional cash advance fee on the amount withdrawn, which only adds to the levies. Personal Loans don’t charge any related fee. Hence, if you need emergency cash, it is advisable not to withdraw cash from your credit card account. Instead apply for a Personal Loan.

Avoiding Filing of a Health Insurance Claim

‘No claim’ bonus is what almost all health insurance policies in India offer. Not registering and not availing the claim amount during the policy period entitles the policy holder to avail ‘No Claim Bonus’ in addition to discounts and low premiums. This bonus can be availed at the time of renewal of the same policy provided the renewal is done on or before the due date. If the claim amount is low compared to the percentage of bonus and other benefits offered for the policy, you may opt for a Personal Loan to pay your medical bills.

Meeting Other Expenses

If you experience any shortfall in buying a house or a car, you can apply for a Personal Loan to meet the need. You may also opt for personal credit to meet marriage-related expenses or to fund your children’s higher education.

Most banks have set their minimum Personal Loan principal amount at 30,000. The maximum that you can borrow depends on your income, credit score and other eligibility factors.

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