What Can a Personal Loan Be Used For and How Can It Help?

Personal loans are very versatile and can be used for either clearing your past expenses or planning your future. Though a Personal loan is one of the most sought-after loans, many people lack clarity on using a personal loan. This article will help you find all the reasons to apply for a personal loan and how it will help manage your expenses.

What is a Personal loan?

Personal loans are a credit instrument offered by various banks and financial institutions. They are unsecured loan, i.e. no collateral is required, and comes with certain terms:

1. The repayment tenure

2. The interest rate

3. The monthly payment or EMI.

Uses of personal loan

Since a personal loan is unsecured,  and thus one has to meet the basic eligibility criteria and provide documentation to avail it. The Fullerton India personal loan itself is flexible and can be used for diverse reasons. There are several reasons for using a personal loan: 

• Medical emergency: Healthcare sector in India has advanced a lot, but has also led to an increase in the cost of treating even a small medical condition. Apart from that, the list of medical bills can cause a deep dent to your savings. If you don’t have insurance, or if your health insurance doesn’t cover all the treatment costs, then the best option to deal with such medical emergencies is to take a personal loan. 

• Vacation: After the pandemic, a vacation is something that everyone is longing for. However, the lack of funds may be holding you back. Well, not anymore - you can now go on a dream vacation with friends and family by opting for a personal loan for holiday. 

• Debt consolidation: Paying EMIs for several places tends to be very confusing. In this case, the best option is to opt for a personal loan and consolidate all your debt in one place. With the personal loan amount, you can pay off all your debts and start fresh. Depending on your eligibility, you can also get an additional amount over and above the sum of the principal outstanding on all the loans. However, make sure that the overall interest payable is less than the sum of interest payable on the other loans you are consolidating. You must also consider foreclosure fees and processing fees that will have to be paid. 

• Education loan: Education today is one of the most common expenditures. If an education loan is not possible, a personal loan can also help finance your or your kids' education. 

• Home repairs: Borrowing money to repair something in your home is reasonable. You can make all the necessary changes through a personal loan. You can get a personal loan for home improvement to finance up to 90% of the overall cost. 

• Wedding cost: Wedding in India is a costly affair, and using up all your savings is the worst decision you can make. Instead, opting for a personal loan will help take care of all your wedding expenses. You can see how much EMI you have to shed for the loan through the personal loan interest calculator. 

• Buy electronics/consumer goods: Some daily necessity items can be so expensive that you might have to invest your entire month's salary to buy them. A better option to buy such consumer goods is to apply for Fullerton India personal loan online. It will help you procure quick funds in your account,  through which you can make the purchase, and repay via monthly installments.

• Small business: Starting a business can be a tricky affair. There is a lot of planning that goes behind the scene. One important part of it is capital. Financing your startup with a Personal Loan could make it easier for you. However, do note that lenders require you to have a stable income source to be considered as a loan applicant. 

• Vehicle Financing: If you are looking to buy a four-wheeler or two-wheeler, a personal loan is a great option for you. It will help you get your vehicle without any security. Top lenders like Fullerton India can provide personal loans up to Rs 25 lakhs subject to fulfilling the bank's criteria.

Conclusion

With so many benefits, a personal loan acts as a blessing in disguise for many people worried about managing their expenses and funds. This pandemic has hit many people hard where they lost their jobs and did not know what to do. It is where personal loan helped them in maintaining a healthy lifestyle and meeting all their emergency expenses.