Personal loans get a bad rap thanks to all the calls that sales agents make to us, especially at odd hours. The reason they do that in the first place (apart from the fact that they can make money off you taking the loan) is that personal loans are a great emergency financing solution. It’s sometimes simpler than asking a friend or family member for money, but also known to be cumbersome.
Times have changed now, and getting a personal loan online is a pretty smooth and paperless process. In fact, you can avail of a loan on Fi Money in a matter of minutes.
Apart from the general ease of the process, there are a whole range of benefits that this article will cover.
Here’s the first few things to know about personal loans:
When applying for such loans, evaluate factors like repayment terms, interest rates, limits on borrowing, and collateral requirements.
Unlike traditional lending, unsecured personal loans are easy in terms of application and approval.
The lender checks your credit score after analysing aspects like active income, previous repayment history, dues, and credit card debt. If you have a good score, the overall process is fast, and you receive the funds quickly.
Do you know a standout benefit of obtaining a personal loan?
You don’t need to provide details of any collateral asset (at least for unsecured loans). This means you can receive these funds without keeping a car, land, house, or other assets as security.
Lenders check your credit score, KYC, and bank statements to provide personal loans. Generally there’s no other documentation required for a loan.
Buy your dream smartphone or travel abroad — personal loans have no limitations. You can also use a single fund for multiple purposes. Although, it is not recommended that you use personal loans for discretionary expenses (any expense that you don’t strictly need). You can instead consider using the loan for emergency expenses or debt consolidation.
If your current credit history is poor, you can apply for affordable personal loans and make sure you repay them on time.
This way, your credit score improves, which makes it easier to subsequently apply for loans at better interest rates.
In the case of personal loans, you can choose the repayment tenure. The interest rates remain fixed throughout the duration.
Your only responsibility — pay the loan on time! That’s it. In most cases, you do not need to worry about any modifications in the interest rate.
Personal loans are a quick way to cover your financial requirements. They offer benefits like a quick process, less documentation, versatile applications, and a stable interest rate.
Fi Money provides instant loans that arrive directly in your savings account. These are pre-approved personal loans made available to select users with good credit scores. On Fi, this process is 100% paperless, and the loans are provided at competitive interest rates — where each user remains in control with complete visibility of all details. Plus, you can avoid EMI late fees by setting up automatic in-app payments. Our licensed partner bank assigns an eligible loan amount to each user (up to ₹5 lakh).
People apply for personal loans to cover debts, remodel their houses, finance their vehicles or cover vacation costs. In addition, personal loans work well to take care of emergency expenses or higher education costs.
The risks of personal loans include high-interest rates, upfront fees, and debt burden. If you fail to repay the loan, the impact on your credit score is negative.
The best loan depends on your specific financial needs. Home loans are good for buying homes, education loans for education expenses, and personal loans for various purposes.
Some loans, like home loans or education loans, might be better suited for specific purposes due to lower interest rates and longer repayment terms.
It depends on your financial situation and the purpose. Personal loans can be useful for various needs, but consider the interest rates and your ability to repay before taking one.