As a common man, you must be having various dreams such as going on a vacation with family, furnishing your new home, planning a wedding, in all these cases a personal loan really plays a pivotal role in fulfilling your dreams. Acquiring a personal is one way in which you get to enjoy fiscal assistance and give wings to your personal desires, without dipping into your savings. A personal loan is sanctioned quickly and being unsecured in nature, you don’t even need to have assets to get approved for it. Your take-home salary is one of the key factors on which the sanctioned loan amount will depend. The minimum loan amount can be Rs. 20, 000 going as high as Rs. 25 Lakhs. Allow me to explain with the help of an example as for how a personal loan can work out.
Let us assume Ajay Kaushik is working in a multinational company. His father, a retired government employee, wants to purchase a home in his hometown. The cost of the land is Rs. 10 Lakhs and Ajay’s father is only able to manage Rs. 7 Lakhs. Ajay knew that with this annual salary of Rs. 8 Lakhs, he is in a position to afford a personal loan of Rs. 3 Lakhs, owing to this he asked his father to go ahead with the purchase. Ajay was offered an interest rate of 14%, he made a plan to repay the loan in a span of 3 years with an EMI of around Rs. 10, 250. With the help of a personal loan, he will be able to fulfill his father’s dream of owning a dream land.
Here, I am discussing some of the important tips you should remember while acquiring a personal loan –
- Needless to say, you should have also planned a set budget beforehand.
- You can take the help of a professional in knowing all the risks involved, in case of secured loans.
- It is important you have borrowed the amount you need and avoid borrowing in excess.
- Make sure you have checked your credit report well in advance before applying for a personal loan.
- You should not only know the interest rates, but it is important to be familiar with various other charges, associated with the loan, such as prepayment penalty.
- Make yourself familiar with the APR (annual percentage rate) i.e. the interest you will have to pay on the personal loan.
Fulfill Your Dreams With A Personal Loan
Here is how a personal loan can fulfil your dreams.
#1. Making Down-Payment Of The Loan
With the help of a personal loan, you won’t find it hard to make the down-payments for your home. After all, a personal loan will help in funding up to 80% of your house’s cost and the rest of the amount will be borne by you. Usually, the down-payments will include 15% to 20% of the total value of the property and you will have to spend more for the registration of the property which you can pay for using a personal loan if you are short of funds.
#2. Purchasing Household Appliances
Seeing the soaring temperature, if you are planning to purchase another air conditioner then make your move as this is the right time to go for it. In addition, if you want to replace your old refrigerator with a new spacious one or probably want to lay your hands on the latest LED TV, then a personal loan is your best bet. Purchase of furnishing and consumer products are amongst the key uses of a personal loan.
#3. Going On A Vacation
Traveling is also one of the emerging areas where a personal loan can come handy. With the help of a personal loan, you can turn your dream holiday into a reality. If you always wanted to take your family to the Disneyworld but you have not saved enough, you don’t need to worry as booking a trip with the help of a personal loan makes it easier for you.
#4. Organizing Marriages And Family Functions
We all are well-aware of the importance of a wedding in our lives. Our Indian weddings are incomplete without the display of grandeur, gold, and pomp. Chances are you may want to be a trendsetter by having an elaborated guest list. A chic and lavish venue with an exotic variety of cuisines can be a costly affair. You can opt for a personal loan for special occasions such as family functions and marriages. Don’t restrict yourself and plan a grand wedding, go for a marriage loan which is offered by most of the banks under the bracket of personal loans.
#5. Expanding The Business
In case you own a business and you are looking to expand your operations then a personal loan, in the form of a business loan, is what you should go for. A personal loan can also be opted if you have plans to start your own business provided you have submitted all the required documents and your business plan as per the requirements of the bank/lender.