Business loans have very high-interest rates. Personal loan interest rates are comparatively lower and if the loan is making you more money in the long run through a business it’s always a good option.
Personal loans also have types if you don’t have any assets to pledge for then an unsecured personal loan can be a good option for you. You are also not risking any assets. If you do have some assets to pledge upon then a secured loan might be a good option as they tend to have lower interest rates. Try to take a loan with fixed interest rates as loans with recurring interest rates get way too complicated after a while. Having a fixed amount of EMI to pay monthly is always easier than an EMI which changes every month. If you have a good study of the market and if you know that recurring interest rates will after a while then taking a loan with recurring interest rates can be a good option.
Processing fees and origination fees can add up when taking a personal loan as they are certain percentages of the amount borrowed. They are in the range of 1% to 4% of the total amount. Check different bank fees and then apply to the one with the lowest processing fees. Remember that you also need to pay taxes on these processing fees and they can end up being costly.
Personal loans are heavily reliant on credit score go online and check your credit score and then your EMIs according to your credit score for your loan. A personal loan is only beneficial if you have a good credit score. Some people who don’t even have a credit card cannot avail of an unsecured personal loan. HDFC personal loan also checks credit scores for secured loans to check your eligibility to pay the loan back in a fixed period.
Pay attention to the personal loan interest rates closely sometimes personal loan interest rates can be very high and their repayment periods are only 60 months. Make sure you will be able to pay back the money along with the interest in that time period.
They are the most helpful to people with no collateral to keep for the loan hence their interest rates can be higher than a car loan or home loan. Although for people with good credit scores will be able to secure lower interest rates which can be beneficial as you are not risking any collateral property that you own.
The biggest advantage of a personal loan is that it can be used for any expense that you want to make. So, if you are going to have big recurring expenses rather than getting two different loans just take one consolidated loan as the second loan might not get approved because of the first loan.
Indians used to be way more skeptical about availing loans traditionally but that scenario is changing. People are starting to realize that rather than using up all your savings some times it might be beneficial to take a loan and just pay manageable monthly instalments.
As compared to business loans personal loans have lower interest rates hence in the initial stated of a start-up company it is advisable for the businessman to take a personal loan with that lower interest rate and with a business you can make more money in the longer run.
Read More:- Personal loans: Find the right rates for you
No comments:
Post a Comment