Personal loans are one of the most popular financing options that can help individuals take care of any emergencies. From quick fund disbursal to minimal documentation, higher borrowing limits to low interest rates, the list of benefits goes on. Apart from this, personal loans do not have any restrictions on fund usage as well, which makes them a preferred choice.
Financial emergencies can come unannounced in everyone’s life, and they often leave the person in a precarious situation. From unexpected medical expenses to unplanned travel, sudden purchases to business needs, the reason can be anything. Sometimes, it can be challenging to arrange the required amount of money on time. In such situations, obtaining a loan seems like the best option to get quick access to funds. While there are several different financing options available these days, personal loans definitely stand out among others.
What is a personal loan?
A personal loan, as its name suggests, is a type of loan obtained to cover personal expenses. Unlike other popular financing options, these loans do not come with any restrictions in terms of fund usage. Apart from this, these loans are collateral-free as well, which means you don’t need to pledge anything to borrow the money.
Key Benefits
Quick Fund Disbursal
When an individual is dealing with a financial crisis, waiting for days or weeks for loan approval can be a little difficult. Personal loans come with quick fund disbursal, which makes them ideal for such situations. These loans have a simple and straightforward application procedure, leading to a lower turnaround time. In most cases, the loan gets sanctioned within 2-3 days of submitting the application.
Minimal Documentation
Another reason that makes personal loans a preferred choice among borrowers is their minimal documentation. You are not required to do complex and lengthy paperwork. All the relevant documents can be uploaded online along with the loan application form.
Higher Loan Amounts
In personal loans, there is no limit on the borrowing amount. Usually, the lending institution decides the loan amount one is eligible for after determining his/her creditworthiness. If an individual has a steady source of income with a good annual amount, he/she can obtain a higher loan amount.
Competitive Interest Rates
As compared to several other financing options, the rate of interest for personal loans is significantly lower. Nowadays, a large number of lending institutions are offering personal loans at competitive interest rates. Especially those with a strong credit history can obtain a loan at a lower rate of interest.
No Collateral Requirement
While applying for a personal loan, you are not required to pledge anything. Their collateral-free nature makes these loans accessible to a broader range of borrowers.
No Restriction on Fund Usage
Personal loans also give you enough flexibility in terms of fund usage. Whether you need to make a major purchase, pay a bill or take care of some other expenses, you can do that with this financing option. Some people also obtain personal loans for debt consolidation, where they pay off multiple smaller loans and save a significant amount of money on loan interest.
Obtaining a personal loan is undoubtedly one of the quickest and most hassle-free ways to arrange funds for a financial emergency. A large number of lending institutions are offering loans with competitive interest rates. You can easily compare various schemes and apply for an instant personal loan online.
