Expenses usually kicked you when you most insignificant assume them. At times, you may notice insufficient funds to satisfy these obligations, forcing you to borrow money. For example, a family member requiring immediate medical emergency, for children’s education or other expenses that may come up quickly and may not provide a lot of time for planning. You end up taking a personal loan or utilizing your credit card to satisfy such obligations. While handling multiple credit cards has its advantages; careless or wild use could pull you into a credit card obligation. The incapability to pay your credit card dues in full brings a very high-interest rate. Credit Cards typically carry a higher rate of interest than a Personal Loan. Alternatively, of using revolving credit on your cards, you can choose a single Personal Loan which enables you to pay a lower interest rate on your debt. You can also pay it off in easy EMIs over a period of time.
What is debt consolidation?
Debt consolidation refers to decreasing the number of loan accounts to protect hard-earned money from high-interest outgoings and enable you to repay the money quickly. This said, debt consolidation should be planned prudently; in such a way that the loan has a high-interest cost is returned with a fresh loan given at a lower interest cost and the best terms.
How a Personal Loan can help in debt consolidation?
Personal Loan is a quick way to do debt consolidation. A Personal Loan is rightly referred to as “a loan in need”. It gives easy access to money when you want it the most. Furthermore being an ‘unsecured loan’, you do not have to mortgage your property to avail of a Personal Loan. Axis Bank Personal Loan simplifies the process even more by allowing online loan application and disbursal process with minimal documentation for new customers. Existing Axis Bank customers can get instant disbursal with zero documentation. Also, make sure the new loan has beneficial features such as flexible repayment tenure, zero-prepayment charges and zero foreclosure charges.
The high-cost loan can be pretty stressful. It can take a toll on your finances and even transform your short-term and long term financial purposes. If you have used on a lot of high-cost debt, the mounting EMIs and interest rates may enforce you to drop into your savings and emptying them. However, there is another option that can come to your rescue – getting a lower-cost, long-term Personal Loan for debt consolidation.
What matters for the bank while allowing a Personal Loan is borrower’s age, the nature of your work, company you work for – private limited, loan requirement, net monthly income, and your repayment capacity (exhibited by your credit score).
Key benefits of debt consolidation:
- Repayment of loans get simplified, with only one or two loan account EMIs to handle
- Your debt responsibility comes down, as the interest shown on loan is optimally reduced (in turn, reducing your total EMI responsibilities)
- Helps you repay your loan quickly and become debt-free
- You possibly put an end to nagging collection calls
- And probably increases your credit score
So, do not delay combining your debt in the interest of your financial wellbeing. For existing customers, the Personal Loan is approved instantly and usually loan amount disbursed within the 3 to 5 working day, if you satisfy the eligibility criteria.
Axis Bank gives Personal Loans anywhere between Rs 50,000 to Rs 25 lakh with a flexible repayment tenure starting from 1 to 5 years. Axis Bank currently levies no charges for part-prepayments and foreclosure of a Personal Loan. Personal Loan offered at a lower interest rate is a worthy proposition.
As a careful borrowing activity, first, evaluate your loan obligation, and then determine how much the EMI on your Personal Loan will be using LoanMoney’s Personal Loan EMI calculator — a useful online tool that gives the answer in second.
To get your Personal Loan passed quickly, do the following:
- Keep a good credit score (750 and above)
- Do not submit multiple loan applications (It can show on your credit score)
- Make sure you have not availed of a personal loan in the last six months
- Make sure your EMIs do not exceed 40-50% of your net monthly salary
- Use a credit card with control and pay all your bills on time
- Keep a good balance between a secured and unsecured loan
