An
individual may avail personal loans to suffice his urgent and as the name
suggests, personal needs. Every person faces financial constraints in their
life, be it for a medical emergency, child's education or any sudden personal
need.
Money
is needed in every aspect of life, and everything might not be solved through
our savings. To meet their financial limitations, people take general loans
like home loans to buy a house, car loans, gold loans, etc. These loans are
specific and the amount disbursed can only be used for the purpose mentioned to
the lender.
Moreover,
these general loans require a guarantor or collateral to any of the borrower's
asset as an assurance for failure in non-payment of the loan amount. Such loans
are quite hectic to get approved and require tons of documents and procedures
to be processed before your loan finally gets sanctioned.
Personal
loans are also known as unsecured debts are loans that help you meet your
emergency financial needs as fast as possible. In this kind of loans, the debt
is not protected by a guarantor, or collateralized on any asset of the borrower
but in case of forfeiture; the borrower has to face the condition as set in the
agreement.
A loan might get you out of that sudden emergency
but repaying the EMI is monthly trouble. Payment of the EMI every month is
absolutely mandatory and, your bank website from where you have taken the loan
from provides a personal loan EMI calculator. A personal loan EMI calculator
helps you calculate, considering the rate of interest, the EMI to be paid as
payment. Click here
to know more about EMIs and how calculators can help you calculate the interest
on your personal loans.
A
personal loan is usually taken from a government-aided bank or a private financial
institution to meet the personal needs of an individual like travel expenses,
wedding affairs, child's education, etc. However, as an individual, you may
face several problems at the same time. Therefore, you may require more than
one loan simultaneously.
If
you are thinking it is impossible, you would be surprised to know it is very
much possible. To avail multiple loans from the very same account at the same
time, you need to prove the lending financial institution that you have a
steady income and the right amount of income to pay the debt off. You need to
show the bank that you can fulfil all your debts within the stipulated time.
But after availing all these loans, you need to put your attention in managing
all the EMIs of your multiple personal loans. Here are 4 tips to manage your
multiple EMI personal loans:
●
Repay high-interest debts first:
It
is wise to hit the rod which is hot. Keep your priority in paying the loans
with high interest and have to be paid soon. Make a list of all your
outstanding debts and identify the high-interest personal loans to be tackled
first. This will decrease your interest burden. Pay the maximum amount you can
while keeping enough to pay minimal for the remaining loans. This technique is
called debt avalanche where you pay clear the loans from the costliestdebt to less costly ones.
●
Opt for top-up plans:
Getting
a new personal loan to fulfill the earlier one is never going to end the circle
of loans. Instead, try and get a top-up plan for your existing debts. It is a
good option to handle your multiple debts.
●
Consolidate or refinance:
A
number of debts are hard to keep track on due to the different interest rate
changes in different loans. It is humanly possible that you might miss out on
an EMI which means penal interest and a bad credit score. Consolidate the
several loans into one. You can avail one loan in low-interest rate to pay off
the existing ones. Keep track on the recent interest rates and consider getting
your loan refinanced if you get better interest rates.
●
Look for an extra source of income:
More
resources can fill more pots. An extra source of income can help you save your
money and pay off all your EMIs without degrading your lifestyle. Work harder
to pay off your debt soon.
Manage
your EMIs efficiently and carefully opt for loans only if you have the capacity
to pay them back.
