Personal Loans have become a necessity in the wake of uncertain economic times at present. Financial emergencies are more or less an integral part of modern life,and it is challenging to be prepared for them in advance. These emergencies will hit you when you are least prepared for it and as such are left running around trying to arrange money to take care of the expenses at hand. Undoubtedly, you would have saved some money for the rainy days, but would you want to exhaust all your savings in one go and be left unprotected for future? What if after a few months you again have to take care of some urgent expenses but have no money left with you? Would you ask someone to lend it to you? What if there is nobody from whom you can borrow the money? In order to avert such a situation, the best option that you have is to Get a Personal Loan.
How to Apply for a Personal Loan?
A few years back, if you had to apply for a Personal Loan then you would need to visit the branch or office of the lender and fill out lengthy forms along with numerous photocopies of your financial documents and the whole process could have taken many days to be accomplished. But now with the convenient online Personal Loan applicationprocess, the entire process for loan approval and disbursal takes just a few hours. You just need to do some research around and identify the lender who is offering you the best deal in terms of amount and interest rates.
Online Personal Loan applicationrequires you to fill a simple application form with your essential details and submit scanned copies of your financial documents. If your application meets the eligibility criterion of the bank, then the loan amount would be credited to your bank account withinthree working days after the signing of the loan agreement.
About Personal Loan Refinancing
The usual tenureof a Personal Loan extends up to 60 months,i.e., you are required to pay 60 equal monthly instalments to repay your loan. When the repayment tenure is so long, even a slight reduction in the interest rates can result in a lot of savings for you. This is where the option of Personal Loan refinancing comes into the picture.
Personal Loan refinancing is a facility extended by a new lender wherein the new lender takes over your existing high-interestPersonal Loan and you are offered a new loan at lower interest rates. This means that the old loan account is closed, and a new loan account would be created. The new lender would be repaying the entire balance principal amount to the existing lender,andthereafter you must pay theEquated Monthly Instalments (EMIs) to the new lender. One of the biggest reasons for Personal Loan refinancing is lower interest rates, but in some instances, there could be other reasons attributable to this decision.
Why Should YouGo for a Personal Loan Refinancing?
Personal Loan refinancing is a huge financial decision and should be taken after thorough analysis only. However, in most cases, the advantages offered by PersonalLoan refinancing are significant and thus make a compelling argument in its favor.
- Your credit score has improved
If your credit score has improved significantly since the last time you took a Personal Loan, then you can conveniently get a better deal from a new lender on your existing loan. A higher credit score signifies better repayment capacity and improved financial standing on your part and as such lenders will be willing to offer you Personal Loan refinancing at lower interest rates.
- You can save on interest expenses
As the market for Personal Loans has become highly competitive, a large number of lenders are offering significantly lower interest rates against Personal Loans. As explained above, a slight reduction in interest rates for Personal Loans can help you save a lot of money. So, if you are able to find a lender, who is willing to offer you the facility of refinancing at a significantly reduced interest rate, then you must go for it.
- You want to reduce the EMI amount
If your financial situation is on shaky ground and you need some breathing space, then you must opt for refinancing at lower interest rates, which would help in the reduction of the monthly instalment. If you feel that the burden of the EMI has become too much for you, then also you should opt for Personal Loan refinancing and opt for an extended repayment tenor, which though will increase your interest expenses but would reduce the amount you need to pay every month.
Personal Loans offer an excellent option for you to manage your personal finances efficiently but if you have the opportunity of refinancing your Personal Loan at lower interest rates, then you must seriously consider this option.
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