Paying Personal loans on Time

Posted by Trishya Sharma on November 13th, 2019

Facing cash crunch is common these days. No matter how well one plans their finances, or budget for all your expenses every month, a few financial hiccups is bound arise on account of unforeseen expenses. Even then, meeting them is no longer an issue, thanks to the advent of personal loans. Thanks to the sheer convenience they offer in terms of access to short-term funds, a personal loan has become the go-to solution for people who are faced with an emergency. As important as it is to do your good research on how to get a personal loan, it is imperative that  a personal loan should fit to the pocket and should be paid off on time. Here’s 4 ways that you can use to pay personal loan comfortably and faster.

1. Borrow what is needed:

Borrow basic minimum that fulfils the current requirement. It is needless to say that loan is still a debt at the end of the day and that accumulating debt must be paid back earliest possible. Loan to meet your exigency and little extra borrowing may become a habit of spendthrift. Ensure you only borrow the amount you need, based on the specific purpose for which you’re taking the loan, despite personal loan being unsecured and unasked for the purpose.

2.   Budget your EMIs:

Personal Loan’s EMI must fit your monthly salary pocket. A loan that fits your pocket. Hence it is good to plan a budget before taking a loan and one may also opt for either a short term loan like Advance Salary Loan or EMI Free Loan wherein one pays only interest. SO first meet all obligations, savings, household expenses before applying for kind of personal loan. That way you will be able to pay your EMIs on time and without defaulting.

3.  Optimal usage Credit Card

After taking personal loans, if your fixed cash outflow is already 40-50% of monthly income, then credit card usage must be limited.  In general also, one should not use more than 30% of his, her credit card limit. One should use credit card only when he is sure of paying back entire amount in a bill’s cycle else any purchase must be restricted.

4.   Prepay or Increase Repayments

You get quarterly bonus. Pay back principal loan amount – partial or in full. Some institutions charge foreclosure or prepayment charges and therefore, check for these factors  before you apply for loan. Also if your salary increase, you can apportion certain percentage of increase towards higher amount of EMIs as compared to originally agreed. This way, repayment is faster and one finishes the loan in faster.