Most people prefer a personal loan at times of financial crisis. Be it for luxury or emergency, personal loans can help you eliminate your financial constraints without any hassle.
You can apply for these loans online, and the lender will send a representative to collect the documents from your home. The personal loan approval process is quick, and it can be disbursed to you within 24 hours after completion of the documentation process.
Personal loans become an exceptional funding option owing to these features, thus, making your goal even more achievable.
At the same time, you must make sure to repay the loan in due time. Failure to do so can lead to a decreasing credit score plus other consequences.
So, here are a few repayment options that can help you save money:
- Part Pre-Payment
Part pre-payment is a facility provided by the majority of lending institutions with their unsecured personal loan. You can pay a part of your loan principal with interest through this facility. This either reduces your EMIs or the loan tenure.
If you have additional funds in hand, you can use the same to part pre-pay your loan. The lender might charge an additional fee for this service.
- Loan Balance Transfer
A loan balance transfer facility can reduce your interest rates and eventually, the EMIs. This facility enables you to transfer the outstanding dues of your loan to a new lender that offers lower interest rates than your current one.
Thus, your loan becomes more affordable and easier to repay. Your current lender may charge you a fee for providing this service. Furthermore, you may have to pay a minimum number of EMIs to avail this facility.
Also, the new lender might offer you a loan top-up with this facility. With it, you get an additional top-up amount when you transfer your balance.
- Flexi Personal Loans
Flexi Personal Loans can reduce your EMIs by up to 45%. This feature enables you to pay interest only on what you withdraw from the sanctioned amount on a daily basis. Flexi Loan facility lets you withdraw as much and as many times you want to without incurring any extra charges.
You won’t have to pay any interest if you repay the amount within 24 hours. Additionally, you can also choose to pay the interest as EMIs and repay the principal at the end of the loan tenure.
Withdraw as per your requirements, and you don’t have to pay interest on the entire amount as compared to traditional personal loans.
Make your repayment of personal loan easier:
- Apply for an Electronic Clearing Service (ECS)
You can instruct your financial institution to deduct your loan EMIs every month automatically. You need to fill an ECS mandate to avail this facility.
This facility makes your EMI payments easier in case you forget paying them. Thus, you can avoid paying penalties when you fail to pay your EMIs.
- Use your investments to pay off the loan
Use your existing investments to pay off your EMIs at times of emergencies. However, consider these facts before doing so –
- How much you are earning from your investments presently.
- How much you are going to save on your interests if you utilise the investments for paying off the loan.
Now, if the savings on interests are more than your earnings from investments, then, it’s feasible to go ahead with this choice.
- Borrow only what you can repay
Borrow only the amount that you can repay without making it a burden. All you have to use a Personal Loan EMI calculator to evaluate your monthly repayments before applying for a loan.
Keep the above things in mind, and you can save a considerable amount of money while repaying your loan.