When you are stuck in a financial crunch going for a personal loan seems the easiest and fastest credit solution. Since you can avail of your personal loan without any collateral this is really a quick financing option. Whether it is a small or a large cache means using a personal loan you can easily meet it. For debt consolidation, medical or educational expenses, a large purchase or your travel needs; a personal loan is perfect for it.
How Does a Personal Loan Work?
In a personal loan, a lumpsum amount is disbursed in your account that you repay over the period in fixed monthly instalments. Each instalment consists of a portion of the principal amount borrowed added with the interest applied over the total sum divided evenly by the number of months.
You can apply for a personal loan with your personal credentials like name, age proof, residential address, and income proof along with a photograph to complete the procedure. Based on these documents your credit limit is calculated and a loan is given. From the next month onwards, you start the repayment of your personal loan and once it is completely paid back the account is closed.
You might also like to read: How to determine if your investments are too risky
5 reasons Why a Personal loan is a Good Finance Option
- One Lumpsum Credit Option: A personal loan is not only a quick credit option, but it also helps the best when you need the money for a bigger expense. In a personal loan, a one-shot payment of your requested credit is done that helps in meeting the larger monetary needs. Expenses like house renovation, making a big purchase, business requirements, debt consolidation etc. can be easily met using a personal loan.
- Versatility in Use: The Instant personal loan comes with no restriction on the usage of the money. You can use your personal loan for various financial needs like medical and educational requirements or personal expenses like marriage or travel et cetera without any challenge. Since no restriction on purpose is there a personal loan is perfect for multiple and variable cash needs.
- Instant Funding: You can apply for a loan easily just based on your income or your credit score and without any collateral hence it is an instant funding solution for you. Being an instant credit solution, it is also perfect for emergency or urgent cash requirements like medical or sudden travel plans.
- Better Credit Health: Getting a personal loan and paying it back regularly without any default and college helps in building your credit helps. Since a personal loan is easy to avail credit option chances are high of its failure of repayment. But when you repay the loan as a responsible body it casts a positive impact on your credit score
- Easy & Disciplined Payback: Personal loan repayment is done through fixed monthly EMIs. This helps in making your budget and extracting the due instalment easily. Since you repay your loan monthly in fixed instalments chances are the least for default in repayment.
Although repayment of a personal loan is done through fixed monthly EMI is making it is a disciplined payback system but difficult as well at the same time. A personal loan is always applied when there is a cash crunch and additional financial support is required. During that cash crunch managing fixed monthly payments sometimes becomes tough making a personal loan not so perfect financial option. Thus it is recommended to check out a few alternatives for a personal loan before going for it. Chances are high that you land on a better loan deal with easy repayment options.
You might also like to read: Is the Population of Fintech Unicorns Going Out of Control?
FlexSalary Instant line of credit can be a good alternative to a personal loan when you need financing. A credit line of credit limit is approved on your account out of which you can withdraw money any time and then only the interest is applied. Unlike a personal loan in a line of credit, interest is not charged on the total lumpsum approved limit. As you use the money you pay the interest, and the ideal portion of the approved credit limit accrues no interest at all.
5 Reasons Why FlexSalary Can be the Best Personal Loan Alternative:
- 100% online and simple application process
- Large credit limit varying between R. 500-2L
- Reasonable interest rates with 0 hidden charges
- Minimal and digital documentation
- Instant approval and quick credit disbursal
FlexSalary also provides flexible repayment options as no fixed EMI is mandatory here and you can manage the loan repayment easily as your budget allows. As long as you are making the minimum monthly payment no penalties will be imposed making it a good on-pocket credit facility. Getting the credit line is also easy at FlexSalary based on your salary slip and bank statement and after a soft credit pull. Since no collateral and no hard credit check is done here this can be the perfect alternative to a personal loan.