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Financial prudence can help you avoid a whole host of trouble such as late payment charges and a credit score dip. Planning the repayment of your personal loan EMIs can help you avoid the last-minute hassle to organise your finances.
Despite the moratorium on loan EMIs, announced for the period of March and August this year in light of the pandemic, experts advised borrowers to repay the loans on time if possible so as to avoid any financial implications later.
Let’s understand how can personal loan repayment be done in an effective way:
1. Have a dedicated account for repayment of EMIs
It is a healthy practice to build a cash reserve using your savings before you apply for a personal loan. This can help in the timely EMI repayment of the loans. You can either pay the EMIs from savings accounts dedicated for this purpose or use these funds to start a Fixed Deposit account. The monthly payout form a non-cumulative FD can significantly bring discipline to the repayment process.
2. Keep track of deadlines
Respecting the deadline for the EMI payments is crucial. Missing on payments can lead to EMI bounce charges and penal interest. All the necessary details regarding the deadlines are provided to a borrower by the lender while signing the loan agreement. You must earmark all the important dates on your email or smartphone calendar so that you don’t end up forgetting the repayment date.
3. Choose your tenure wisely
The choice of the repayment tenure can have a direct impact on the affordability of the personal loan. Therefore you must review several factors such as your monthly income and monthly expenditure before you decide on a tenure. Review these details would help you decide how much of your income would be available to you to pay the EMIs. You can then use the personal loan EMI calculator to arrive at the most suitable tenure based on the EMI amount that you can comfortably repay.
You can consider taking a loan via Finserv MARKETS, where you can find flexible tenures from 12 to 60 months. These loans offer a diverse range of benefits like easy online application, instant approvals and nominal rate of interest.
4. Choosing the right lender:
You should avoid rushing things while you avail a personal loan. Through research on metrics such as interest rates offered by various lenders, repayment duration offered and other costs should be undertaken. A solid comparative analysis would help you choose the right lender. Besides, check the rest of the fees and charges associated with your personal loan. These can include processing charges, secure fees, annual maintenance charges and EMI bounce charges. Borrowers must also check the cost of making part prepayments. You should avoid lenders who charge you too much to repay your loan earlier than anticipated. You should look for lenders who offer you maximum flexibility. For instance, on Finserv MARKETS, you can find a Flexi Personal Loan to help you meet unpredictable needs for finance at affordable rates.
Flexi Personal Loan
This facility allows you to access a certain amount to you for a specific tenure. You can make multiple withdrawals from this amount based on your requirements. The benefit here is that
you only pay interest on what you withdraw and the rest of the amount remains interest-free.
Such a scheme is especially useful when you are availing a personal loan for a wedding or travel, as last-minute expenses can disturb the math.
You can further choose to pay interest-only EMIs and pay off the principal at the end of the tenure which can help you manage your cash flow better. Interestingly, you can prepay funds when you have the money at no cost and even re-avail the prepaid amount.
Implementing these methods can help manage your loan repayment effectively. Such methods will not only help you reduce your repayment burden, but also keep your CIBIL score healthy so that you can avail loans whenever you require. With financing options available on Finserv MARKETS, you can borrow money as and when you need from your sanctioned amount, without the need for multiple applications and additional documentation. Besides, Finserv MARKETS offers the fastest personal loans in India – with disbursal in just 24 hours of your loan getting approved. Also, you can avail Instant Personal Loan up to Rs. 25 Lakhs based on your eligibility.
