A Flexi loan is an innovative type of loan option extended by a number of lenders. Falling under the ambit of a Personal Loan, this facility permits the borrower to withdraw an amount as per his/her requirements, pay interest only on the used amount, and settle the remainder when the loan tenor ceases. So, if you are looking to make varied on-going purchases, a Flexi loan is your best bet.
What Makes a Flexi Loan So Attractive?
- Can access funds anytime, on a continuous basis
- Accommodating funds for house refurbishments, daily spending or even improving your elevated interest debt
- Only pay interest on the amount you are borrowing
- Attractive rate of interest
- Obtain round-the-clock access via mobile banking or internet
- Repay the entire amount or part of the remainder at any time
What Are Its Salient Features?
- How is it disbursed: A Flexi Personal Loan is Flexible and can be re-used. Once approved, the borrower can avail any amount of the credit limit at any time.
- Interest rates: The rates vary depending on credit score
- Repayment choices: The borrower pays interest on the amount utilized within the credit limit. This is different from conventional Personal Loans, wherein you pay interest on the entire loan amount. Irrespective of how much is borrowed within the limit, all of it in addition to interest must be paid back by the end of the tenure.
- Security requirements: Depending on the lender and nature of credit, personal lines of credit may be secured or unsecured. However, you may be able to avail a lower rate of interest with a higher credit limit if you pledge some asset as collateral.
- How it works: The upper limit amount one can get will depend upon the lender and the borrower's credit qualifications.
Who Can Qualify For a Flexi Personal Loan
Typically, a Flexi Personal Loan is not secured with collateral. Customers who have a high credit score, with a strong credit history and have a proven ability to repay the line are usually offered a Flexi Personal Loan. Therefore, the higher your credit rating, the better are your chances of getting a Flexi Personal Loan effectively.
You might need a Flexi Personal Loan if you are working on commission or have irregular income. Your finances can be smoothened out with a Flexi Personal Loan.
Difference between a Flexi Personal Loan and a Personal Loan
A Flexi Personal Loan offers you the option of using only the amount you need. Also, its rate of interest is usually lesser than Personal Loan rates.
Your repayments will be variable and dependent on the overall owed balance. In comparison, a Personal Loan has a pre-determined rate of interest and fixed monthly repayment.
Points To Note:
- Only Interest is Paid as EMIs - You have the option of paying only the interest component of the loan as the EMI. In doing so, you will be able to manage your finances efficiently and save extensively.
- Similar To An overdraft facility - In an overdraft amenity offered by a bank, whenever your balance arrives at a negative figure, the bank helps cover the payments. However, you have to pay an additional rate of interest and a processing fee. With regards to a Flexi Personal Loan, lenders do not levy processing fees. The interest rate is much lesser too.
- Collateral Unnecessary - Since a Flexi Personal Loan is a characteristic of a Personal Loan, it functions like an unguaranteed loan. If you have a good CIBIL score and you conform to all the terms and conditions of the lender, you can effortlessly avail it.
To Sum Up:
A Flexi Personal Loan is like any financial product - it's beneficial, useful and accommodating, to that extent as how you make use of it. A Flexi Personal Loan is greatly useful in helping you achieve your goals. If you are seeking to make essential home renovations, car maintenance, coaching payments or finance an emergency expense, a Flexi Personal Loan can extend its benefits to accomplish your needs.
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