A Personal loan is a type of unsecured loan, which can be used by the person to fund any personal needs such as renovating house, buying a vehicle, wedding, holiday trip, medical emergency. In case of personal loan, there is no restrictions on how the borrowed money is used. There is full freedom for the borrower to use the money for any purpose. Lender checks your credit history, source of income, ability to pay before lending you the personal loan.
As there will be less paperwork, the approval process will be quick. You do not have to approach an agent. This avoids unnecessary expenses and delays. You can directly approach the bank or financial institution for the purpose. Personal loans get easily available as you don’t required to provide any security to the lender in the form of vehicle or home as collateral. You have the flexibility to choose a tenure of the loan, which suits you best. The interest rates will be fixed for the entire tenure of the loan. Therefore, you no need to worry about the changes in interest rates.
Consolidate credit card debt:
This is the most common uses for a personal loan. The interest rates on credit card debt usually have high and variable rates. You can take personal loan to pay off credit card balances or multiple bills. You can also save on finance charges and interest rates, if interest rate of your personal loan is lower than the fees and finance charges on your current debts.
By taking Personal loan, you can combine your other debts such as credit cards, payday loans and car loans into one loan with a fixed monthly payment, closed-end term and fixed interest rate. The main objective is to restructure the financing and save money.
Home renovations and maintenance:
Personal loan can be used for Home remodelling. If you want to install solar panels, add swimming pool, landscaping, put on a new roof, touching up paint, remodel your kitchen, personal loan is a best option.
Wedding and Honeymoon:
There will be many expenses during wedding such as decoration, clothing, furniture, food etc, which will be stressful if you don’t have enough funds in your account. Hence, by taking personal loan you can plan your dream wedding. You can also pay for your honeymoon with a personal loan.
When you or your loved ones face medical emergency and if you don’t have enough money to pay for the medical expenses such as cosmetic surgery, dental services, fertility treatments, orthodontics etc. Other expenses include medications, medical travel, parking and aftercare also can be financed by a low rate personal loan. Child adoption is another use to be paid using personal loans. If you fail to pay your medical bills, your credit will be badly affected.
Starting a business:
If you want to start new business, personal loan will help you to pay for all the necessary things that is used for new business such as materials, equipment’s, staffing, office space and other expenses.
Pay for a Funeral:
Funerals are quite costlier these days, Basic costs include the burial or cremation, funeral service and any gathering of family and friends surrounding the memorial. It will be good if one has life insurance but who don’t have any insurance their family members can take personal loan to cover the deceased's final costs.