3 Things You Should Avoid Doing with a Personal Loan

3 Things You Should Avoid Doing with a Personal Loan

Those who say that money does not buy happiness do not mean that money is not important. Undoubtedly, you need to be a bit crazy while chasing money in your life, but you should always attempt to maintain a healthy financial life. Today short term small personal loans are the new rage as you can easily get a short-

term loan; thanks to online lending platforms. However, you should be watchful of some things that you usually overshadow when applying for short term small personal loans.

Although this might be to meet some of the immediate requirements, there are certain instances where a short term small personal loan should not be used. So let us have a look at few of the circumstances where you should not think of using a personal loan:

Taking Loans without comparing A golden rule when availing a personal loan is to look for all the loan offers, not just settling with the first offer.

With numerous personal loan options available, it is very important for you to compare several loan offers before

finalizing a lender. Doing so will help you know more about the interest rates and provides you the leverage of negotiating for your best personal loan option.

Do not apply at multiple institutions simultaneously Applying for a personal loan means that you are in need of money. But you must not let lenders know about how much you are in need of a personal loan. And one of the ways lenders come to know this is if you apply at multiple institutions for your personal loan. And if they come to know it, your loan application is more likely to get rejected.

Borrowing more than you can pay For instance, if you are qualified for a loan of Rs. 1 lakh but you need only Rs. 50000, then getting that extra 50000 can make you

borrow more than you actually need, but don’t. Make sure that you borrow an amount that you actually need. Watch your budget before applying for a personal loan and see whether you can repay the amount within the required time.

Do not miss your EMI’s. Pay your EMIs on time. A default in EMI payment can affect your credit score adversely and can potentially reduce your future loan possibilities. Set up a reminder for making timely EMI payment. So, there you go! Remember these points and strengthen your financial life.