How to take a smart personal loan?

Vineet Jain

A personal Loan is the easiest form of finance available considering the fact that you get money in 72 hours maximum and it does not require any security or collateral. Being smart in choosing the right loan is the way to go as this is a short term loan with higher rate of interest than the other category of secured loans such as loan against property, loan against shares and loan against fixed deposits. So, one must look at factors like exit cost, or pre-closure charges in deciding the lender.

You would most certainly apply for personal loan to serve some of your immediate purpose or fulfil your dreams. Even though, there is no shortcut to make the smartest decision of your personal loan, making yourself aware completely is the most fundamental approach in choosing the right fit for you.

Here are some factors one should consider while taking a personal loan:

1.Do you really need the money?

Sometimes we are impulsive and buy things we might not need so much, and that is when we lean on our credit card or a personal loan as it is fast. Do consider hard before taking the decision to pick up a loan as it is a commitment for some time and it is going to affect your cash flows for a few years.

2.Can you get a cheaper option?

Although a personal loan is the most suitable choice for many purposes, there are some instances when it is worth considering other options. You might use your existing home loan to get an additional top up; it will be cheaper and for a longer tenure. This might keep your cash flows in check as EMIs will be lesser owing to lower rate of interest and longer tenure, provided your existing lender is willing to extend the same basis the valuation of the collateral, and is limited to people who have an existing property backed loan. Read More:-