With personal loans today being readily available at relatively affordable interest rates and minimum paperwork, you may not really need any real excuse to apply for a loan, especially if you are salaried. Typically these loans do come in handy to bridge the need for funds, when you either don’t have the money or are not willing to pay out of your pocket.
Here are few realistic situations that may benefit from such a loan.
Address Medical Emergencies – These are trying situations when there is a need for huge sums of money, that too at short notice. Applying for a personal loan at any of the reputed banks could prove a life saver! Banks tend to process applications from existing customers in a speedy manner.
Settle High Interest Debts – Personal loans are also quite useful to pay off high interest loans such as credit card debts as you can expect a definite savings on the interest. The savings of course will vary depending on the type of loan you plan to settle, the term of the loan and applicable interest rate.
Home Renovations and Repairs – Extensive repairs to your home, expanding the structure or getting a modular kitchen installed definitely proves expensive. Availing a personal loan to address the costs associated with such projects may prove judicious for several reasons. There’s hardly any paperwork involved. More importantly with the right documentation and bills for the amount spent on construction/renovation/repair jobs, you may enjoy a tax benefit (capped at 2 lakhs) on the annual interest.
To Improve Earnings – Lucrative time-sensitive investment opportunities are also money guzzlers that demand prompt responses. Personal loans can be used to fund such investments only after thorough due diligence though. Returns must be way higher than the cost of the loan for the investment to be profitable.
Enhance Business Prospects— Regular loans most often, are out of reach for the non-salaried. Self-employed people running their own businesses use the funds from a personal loan to scale up operations, offer new products or services or even recruit staff as required.
Do also remember that personal loans also help cover wedding and educational expenses as well!
Is it wise for you to take a personal loan to enjoy a foreign trip, splurge on expensive jewellery or refurnish your home? You definitely are not answerable to anyone on how you choose to spend the money as long as you can repay the loan, but it is for you to decide if you really want to shoulder the financial burden!