The financial sector of India has gone through a drastic transformation over the last few years. These days, availing of a personal loan has become simple, fast, and hassle-free due to the online loan application procedure supported by most lenders. An instant personal loan is a multi-purpose loan that you can use to cover expenses for various planned or unplanned expenses. Moreover, since these are collateral-free loans, you do not need to provide any collateral, security, or guarantor to avail the required loan amount.

Since unsecured personal loans are extremely easy and fast to avail, you need to be extra cautious while applying for them and using them the right way. These are a few tips to use personal loans to your advantage.

1.    Know Your Purpose Before Applying

Personal loans are readily available through hundreds of lenders in India. They offer streamlined procedures and no end-use restrictions to apply and use your loan amount. However, you must apply for a loan only when it is necessary. Don’t take a loan just because you are eligible for it.

It makes sense to use your personal loan for expenses like a wedding, home renovation, vacation, higher education, medical emergency, or debt consolidation. However, never take a loan for gambling, investing in the stock market, lending to a friend, or any such purpose. Such activities may put your money at risk, and if you cannot pay it in time, you may get caught up in a never-ending debt trap.

2.    Never Miss Your EMI Payments

When you take an instant personal loan, you must have a robust repayment plan even before applying for it. Make a budget, know your repayment capacity, and choose a loan tenure with EMIs you can easily afford. Many lenders provide personal loan EMI calculators that you can use to calculate your EMIs and adjust the loan tenure accordingly. Missing your EMI payments can affect your credit score and lead to unwanted charges and penalties. Being regular with your EMI payments is the best way to use a personal loan to your advantage.

3.    Use a Personal Loan to Improve Credit Score

When used responsibly, a personal loan can be an excellent tool to improve your credit score. If you stay consistent with your personal loan EMI payments, you may see your credit score gradually increasing. a personal loan can bring diversity to your credit profile, further helping your credit score.

Since you do not need to use your credit card to make purchases for your wedding, home renovation, medical expenses, or others, it also helps keep your credit utilisation ratio low. All these factors are crucial to improving your credit score over time. Since you need a credit score of 725 or above to avail most kinds of loans, you improve your credibility by improving your credit score using a personal loan.

4.    Choose Your Repayment Term Wisely

To make the best use of your instant personal loan, you need to choose your repayment term wisely. Many lenders offer flexible repayment terms that you may choose according to your budget and repayment capacity. Choosing the right loan tenure makes repayments easier and more manageable. You may use a personal loan EMI calculator to get an estimate of your EMI amount. Accordingly, you can adjust the loan term or amount until you find a tenure with EMIs you can easily afford.

5.    Opt for the Online Loan Application Procedure

Many lenders support online loan application procedures these days. There are several advantages of applying for a loan online since you can complete the entire process from the comfort and privacy of your home from your PC or smartphone. You don’t need to visit the lender’s office even once, not even to submit your documents. If you are eligible to apply for the lender’s personal loan, you can have your documents verified online within minutes. You can also compare lenders and decide your loan tenure online.

The entire online loan procedure is extremely fast and streamlined, saving a lot of time and effort. Therefore, you can make the best use of your personal loan by opting for the online route.

Other Benefits and Features of Personal Loans

Apart from the tips mentioned above to use personal loans to your advantage, you must know other benefits and features of unsecured personal loans. Some of them are:

No Collateral Requirement: One of the major advantages of availing a personal loan is that it is collateral-free, which means you can avail it without any collateral, security, or guarantor.

Competitive Interest Rates: You get competitive interest rates by availing a personal loan, which can help you save money over the long term.

Flexible Repayment Tenure: Personal loans come with flexible repayment tenure that you can choose according to your budget and repayment capacity.

Easy Eligibility: Personal loans are easily accessible to all with simple eligibility conditions by most lenders.

Minimal Documentation: No extensive paperwork is required, as you just need a few essential documents to prove your identity, address, and income.

Fast Approval: Since the entire procedure is done online, you may get your loan approval in as little as 15 minutes*.

If you are looking for an instant personal loan and use it to your advantage, use the tips mentioned above to make its best use. Get in touch with Clix Capital to apply for a personal loan of up to ₹ 25 lakhs at competitive rates with flexible repayment terms. We have easy eligibility conditions and minimal documentation requirements to make personal loans accessible to all.

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You can also reach out to us at [email protected] or call us at 1800 200 9898

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