Credit when you need it can literally change lives if it is wielded responsibly like a precision instrument. There is a very wide range of loans available in India these days which can be used to fulfill your different kinds of financial requirements. Among all these loan products in the market, there is one product that really stands apart. A personal loan app perhaps one of the best possible debt instruments that anyone can rely on because of its rainbow of advantages. Here is a list.
9 Reasons that makes a personal loan a good choice
- Wide loan eligibility
The biggest advantage of a personal loan is its very wide range of eligibility. Unlike most other loans which require people to qualify on really wide range of criteria, no exceptions, a personal loan can be taken by almost every financially responsible person who has a stable income. You do not need to have special kind of qualification or have many years of work experience and tax history to qualify for a personal loan.
- Low minimum income requirements
One big factor that places a personal loan over and above everything else is that you do not need a very high income to qualify for a personal loan. If you are earning Rs. 15000 per month then you are eligible to get a personal loan. Whether this is a fixed salary or your income through your business or any other profession, you can get a personal loan if you can assure your repayment capability. The fact that income requirement for a personal loan is so low makes it is widely and easily accessible.
- Easy documentation
Another great thing about personal loan is that you can avail a loan through a personal loan app. It is best for small ticket loans as it needs minimal documentation and the entire process is digitalized. You just have to submit your Adhaar card, PAN card, and address proof, bank statements and income proof.
- No security or collateral
A personal loan app offers you an unsecured loan which means that there is no need for you to put in any kind of security or collateral for getting the loan. Unlike home loan or car loan where you have to put the house or car as mortgage, in personal loans there are no such requirements. You can avail a personal loan just on the basis of your monthly income and your repayment capability.
- No exorbitant fees
The fact that this loan is an unsecured loan also means that the loan processing cost is very low. Most of the documentation can be quickly processed online with minimal human intervention. There is no need for personal verification. This is why loan processing fees is also very low. Also, the processing fee is not to be paid upfront but it is deducted from the sanctioned loan amount automatically upon disbursal.
- Quick loan processing
A personal loan app is perhaps the best way to get this kind of loan because the entire process can be done in a matter of minutes and you will have the loan amount in your account within minutes. Most of the document verification is done over the internet. Lending decisions are taken by artificial intelligence which does not make mistake. They work faster, harder and much more accurately.
- Comfortable loan duration
Unlike other loans, this kind of loan does not stretch for decades. Most personal loans run for two years or so. The maximum duration for a personal loan is five years. For most people, this is a very comfortable duration to pay off their loan. It is the perfect balance of affordable EMI and shorter tenure which means affordable over all interest.
- No loan amount usage restrictions
A personal loan does not impose any kind of restriction on how to use your money. With a home loan, you can only buy a home. With a car loan, you can only buy a car. There is no such restriction with a personal loan. You can use this loan amount as you wish without giving a break down to anyone.
- Easy way to strengthen credit score
When you pay off a loan regularly on time, your credit score improves. Taking a small ticket personal loan through a loan app can be a good start to improving your credit score. This will help you in availing larger loans like home loan or credit loan. But it is important to make all your payments on time and without a miss for your credit score to improve.
Finally, these loans come with a predictable repayment schedule. One big problem with many loans which come with floating interest rates is that their payment schedule will be very erratic. With movement in interest rate, the loan duration tends to change so much that you can have loans stretching by one third or even more of total duration. For those with floating payments, the EMI can sometimes go so high that they end up harming their monthly budget. With a personal loan, you have the option to choose a fixed interest. The period of loan is fixed and so is the monthly payment. You know how much to pay every month and for how many months.