How Useful are Personal Loans During Times of Cash Crunch? - Loan Trivia

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Thursday, 31 August 2017

How Useful are Personal Loans During Times of Cash Crunch?



Personal loans provide the much-needed liquidity at conveniently low rates of interest during financially turbulent times. Compared to other debt instruments like credit cards, these loans are less of a burden for applicants as-


1)     The interest charged is lower
2)   The loan amount allowed is much greater


When an individual is servicing multiple loans and credit card bills, unsecured personal loans help cover all liabilities under one financial solution of debt consolidation.


Repayment default and late payment risks for loans and credit card bills get minimized with a single personal loan-this thereby increases the credit score of a person.

Here’s How Personal Loans help in Times of Cash Crunch


-A lot of money can be saved with debt consolidation to clear off old dues with high interest rates


-Proceeds of personal loans can be utilized for a number of purposes like paying for a home renovation, a medical emergency, weddings or vehicle repairs


-A personal loan can be used to fuel a new business


-Individuals can also avail personal loans to pay for any certification course to enhance their professional skills

Also Read: Personal Loans During Financial Trouble

Since any loan, including a personal loan, is a liability until it is completely repaid, it is important for those availing these loans to utilize the proceeds thoughtfully so as to not impact their individual credit scores in a negative way.

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