A loan taken to meet your personal expenses is referred to as ‘personal loans’. There is no specific or designated purpose for which you can use these loans. Often personal loans are taken by people to meet some big family-oriented expenditure like son’s/daughter’s marriage, a family function, lavish vacation, funding of education, funding new business ventures, buying of luxury goods etc.
Since personal loans can be used for any purpose depending upon the borrower’s discretion, these loans are a great way to pay off outstanding debts. Many use ‘personal loans’ to transfer balance and lower interest rates pertaining to their debts.
Personal loans can be categorized into secured personal loans & unsecured personal loans. Secured loans will need the borrower to attach assets (car or house) or collateral while taking the loan while in case of unsecured loans, one does not have to attach any asset or provide any collateral. Unsecured personal loans may have quite high rates of interest as giving out of such loans involve very high risk for lenders.
Personal loans come with myriad benefits. The first and foremost benefit is that you could use these loans for almost any purpose you like. It all depends on your sole will as for what purpose you would use these loans. Secondly no collateral is required to get a personal loan. If it is an unsecured personal loan that you have opted for, you could get it simply by filling out the loan application and submitting documents for the verification of your financial status.
These days you get quick personal loans online too. Various online platforms offer you such loans with lucrative discounts and offers on interest rates. The maximum amount that could be borrowed as personal loan is somewhere around Rs 10, 00000. The interest rate on such loans is usually a fixed one and the tenure for loan repayment too is a fixed tenure.