Decoding Myths Associated With Personal Loans | Money In Minutes

1. DECODING MYTHS ASSOCIATED WITH PERSONAL LOANS We all face financial problems in our lives and to tackle those problems we look for various solutions. We apply for ​cash advance loans​​to meet financial shortcomings. One of the most common solutions that come to our mind is availing of a personal loan. But mostly we are very skeptical of it. We have various questions running in our mind, such as, should we avail it or not, what are its pros and cons, etc. The reason behind this is we mainly misconceive personal loan as an expensive debt instrument. Because of this, we look for other solutions. We try to use credit cards to fill the gaps created in an unmanaged budget, thinking that it may be an affordable option but in reality, it is more expensive than personal loans. There are many such misconceptions about personal loans that become deterrents for availing of these debt instruments. In this article, we will decode various deceiving notions that are associated with a personal loan. It Takes A Long Time To Apply And Get A Personal Loan Earlier, availing of a personal loan was a tough task. You have to stand in long queues, fill various forms, and submit a pile of documents. But with the advent of the digital era, it has become a hassle-free process, and applying for instant loans online has become easier than ever before. You can sit at home and all the process from the submission of the application to disbursal of the loan will be done easily. All you are required to do is – Download the lender’s loan app, fill in the application form, and upload the necessary documents. In MoneyinMinutes you can get a loan within 15 minutes if all your documents are found sufficient and authentic. With this facility, you can solve your urgent end needs easily and don't have to transfix your eyes on your bank account worrying about when the amount will be credited. A High Credit Score Is The Only Parameter Responsible For Personal Loan Approval A credit score is one of the most important parameters that is considered before processing a personal loan to an individual. However, there are many other parameters also that impact the decision of a lender to approve or disapprove a personal loan. Lenders evaluate various factors such as Credit utilization ratio, Debt to Income Ratio, and Fixed Obligation to Income Ratio while assessing the credit worthiness of an applicant. Age, Authenticity of documents submitted, Income criteria are few other components that factor in the personal loan eligibility of applicants. All these parameters collectively affect the decision of a lender and not just a credit score. Personal Loans Are Only Offered By Banks

2. Many people have the orthodox mentality that personal loans are only offered by banks. But if we talk about recent times, they are very much wrong. With the boom in technology, you can approach Non-Banking Financial Companies (NBFCs) and Financial Institutions for personal loans. However, their terms of service can differ from the traditional banking system, but the overall functionality remains the same. In fact, the process is much simpler than the banks. Fintech lending firms offer flexibility and customer-friendly terms of service. For an instant loan online​​you can go on the website of MoneyinMinutes or download their app available on the Google play store. Personal Loan Demands A High-Interest Rate People generally opt for credit cards to meet their end needs, thinking that personal loans demand a high-interest rate, but the reality is different. In comparison to debt instruments like credit cards, personal loans demand a much lower interest rate. The interest rate on personal loans is generally anywhere between 16% to 24%. Though personal loans indeed charge a higher interest rate than some other loans. But the reason behind this is personal loan is a loan without collateral. The risk involved in lending money to an individual borrower is comparatively high against the risk involved in a secured loan and this results in a slightly higher interest rate. You Can Avail Only One Loan At A Time Qualifying for a single personal loan is not a very tough task, and it is also not in the case of availing more than one personal loan at a time. You will easily get another loan if you have a good credit score and have serviced your past and existing credit accounts prudently. However, the lender will certainly carry out all the necessary credit checks and Fixed Obligation to Income Ratio tests before deciding on approving the personal loan application. These were some of the general misconceptions that people have about personal loans. We hope that we have cleared them. So now you can go and apply for an ​instant loan online​​and fulfill your needs and wants. Also, remember it is necessary to qualify under the personal loan eligibility criteria before availing of a personal loan. Original Source: ​https://blog.moneyinminutes.in/decoding-myths-associated-with-personal-loans/