Believe it or not, the existence of personal loan seems quite sublime sometimes. Yes, there’s no need to secure it against collateral or mention the purpose of having it. Thus, it becomes one of the best options for all those who need them urgently for financial aid.
However, as they say, one should not take advantage of a friend who helps you to bail out in an emergency; one must also not take advantage of the liberties offered by a personal loan. Money matter experts have stated several times that personal loans can spell disaster in case you get careless.
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This post points few things that you should not get using a personal loan.
Planning for a Vacation
Of course, going on a vacation is a great way to clear your mind and de-stress yourself from the burden of work. Yes, this is important, but you don’t need to travel to enjoy some time away from the grind. If you feel you’re low on funds, make sure to explore your city or get some time to relax close to home.
If you are not in a position to pay for the vacation, it’s better not to fund it through HDFC bank personal loan or from any other lending institution. Every time you lend money, you tend to raise interest on the sum. So, eventually, you will end up having a modest vacation at an extravagant cost when you do so through a personal loan.
Buying Your Dream Car
Technically, you can use a personal loan to buy your dream car. But that’s not the best decision to make. There are auto loans available that come with lower interest rates than the former option. But if you choose personal lending, you can have a more expensive option to finance a vehicle.
Personal loans are not secured to attached to any specific asset. On the contrary, auto loans are secured by the vehicle you buy. If you fall back on the auto loan, you may risk a vehicle. But if it happens with a personal loan, you may face more harsh consequences. It may also hamper your credit score and restricts your profile from further lending.
Investing in Business You Haven’t Been Through Properly
Many lending institutions offer small business loans. But if you don’t get to snag one, never go for a personal loan to fulfil your startup costs. If you are 1005 confident about your profit margin, move on this track.
Unfortunately, reports suggest that most small businesses fail within a short span of time. If it happens, the installments or the due payments at the point constitute a major financial burden.
Going for a personal loan from reputed options like ApnaPaisa loans or others could be a great option to borrow under a different set of circumstances. But it is crucial to think twice before making any decision.
You should always look for more affordable options from an interest rate standpoint. Please let’s know whether you have any such plan of executing any of these ideas through personal lending below in the comment section. Take risks only if you are in a position to take one, and there’s n point in being over-confident.