Choose a Personal Loan

Personal Loan is Better Than Borrowing Money from Friends Relatives

05 Jan 2022
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Your child got an opportunity to study in one of the best institutions in India, and you don’t have enough finances to support them. What will you do? You can ask your family or friends to lend some money, but the lifelong burden of this help and indebtedness will stay on you as well as your child. At such times of financial emergencies, it is always better to choose a personal loan over taking help from your friends or family. During unexpected situations, you can avoid risking your relationships by availing a personal loan from financial institutions. Nowadays, many lenders are offering loans at very low personal loan interest rates.

Clarity of Loan Details

Taking advances or borrowing money from your friends and relatives is mostly a verbal agreement. There are little chances that you will discuss details like interest rate, tenure for the borrowed money or repayment option and charges. These verbal agreements can result in confusion and miscommunications, which can eventually put your relationship with them in jeopardy. When there is no record of the transaction, or you don’t sign any documents, disputes could arise at the time of repayment.

When you apply for a personal loan from any lender, all details will be informed to you upfront, and the transaction details will be documented. A personal loan is an unsecured loan for which you don’t have to pledge any collateral. All terms and conditions related to a personal loan will be clearly informed when you apply for one. If you have any complaints or doubts, you can always contact the lender’s customer service. Unlike before, personal loans are now offered with very low-interest rates, easy eligibility criteria, special offers, simple documentation procedures and unrestricted end-use.

Easy Repayment with EMIs

Any disruption in repaying the amount you borrowed from your loved ones can risk your relationship with them. In the majority of the cases, you will return the amount as whole or in 2-3 installments as decided. In case you fail to raise the lump sum amount at that time, things could get complicated. Why wreck your relations when you can easily avail a personal loan? You can pay the loan back in EMIs or Equated Monthly Installments. On a fixed date of the month, you can pay the pre-decided EMI to the lender. The EMI you have to pay each month depends on the interest rate, loan tenure and loan amount. A higher loan amount leads to higher EMI and a higher tenure leads to lower EMI.

Take a look at this example here.

Consider you want Rs. 5 Lakh as personal loan and you are availing it at a fixed interest rate of 11%. Then EMI for different loan tenures are:

Loan Tenure

EMI

1 year

Rs. 44,191

3 years

Rs. 16,369

5 years

Rs. 10,871

Using a personal loan EMI calculator, you can view the EMIs you have to pay each month. Thus you can decide your future EMIs conveniently and repay the loan without hurting your monthly budget.

No Conflict of Interest

When you borrow money from a friend or family, you must have fixed a time to repay it. This will range from a few months to many years. The chances are very less that they will charge any interest on the amount. Out of love, they will lend you the money. In case you fail to repay it on the fixed time, not only that disrupts the trust and relation between you two but also that person’s chance to earn interest by investing the money somewhere else. So, it is always better to avail a personal loan from a lender rather than borrowing it from near and dear ones. You can compare the personal loan interest rates online and get a loan that offers the lowest one.

Avoid Fallouts in Your Relationships

Not being able to repay the borrowed money at the decided time could give way to many awkward scenarios in life. Let's take a look here:

  • Guilty feeling: Suppose your friend or relative who lent you the money faces an unexpected financial crisis. You will feel guilty that they could’ve used the money they gave you to overcome the crisis.

  • Reputation: If you fail to repay the borrowed money in the fixed time, that might affect your reputation badly in your social circles.

  • Distrust: Your inability to pay back the amount to your loved ones on time will result in distrust and create awkwardness in your relationship.

  • Chance for disputes: Failure of repayment can lead to unnecessary arguments or disputes and might make your relationship bitter.

  • Self-respect: If you can’t afford to pay the amount back on time, it may harm your self-respect.

Avail a personal loan from any of the lenders in the market instead of borrowing it from your loved ones and prevent putting your relationship in jeopardy. Finserv MARKETS has partnered with many financial institutions that offer loans, which can help you fulfil your financial requirements when you are in need. Choose the best option that suits you and fulfil all your needs.