Opting for a personal loan? Then, there is a great need to take an overview of its services and terms & conditions. In case you get stuck in debt of personal loan, there are some techniques that you can follow to relieve yourself from this debt.
These techniques include:
If you own assets like life insurance policies, tax saving certificates, car, home, shares, bonds & debentures, bank fixed deposits, mutual funds, and gold jewelry etc., then, you can monetize these assets to pay off your debt. This could be a wise choice as there are many banks that offer loan against assets and such loans carry a relatively lower interest rate.
Debt consolidation is also a good option to consider for your debt settlement. This is a method to use when you can pay your debt at lower and fixed interest rates. Moreover, it offers fewer monthly installments. Basically, what Debt consolidation means is that in this method, all the existing debts of a customer are combined to form a single loan. A consolidation agency looks over this whole process. Then, the agency pays off all the existing loans of a customer and the customer just needs to pay that single debt amount.
Convert your loan to a secured loan:
You can convert your home or vehicle loan to a secured loan but only in one condition if your property is free from debts. There are many benefits of a secured loan like it offers lower credit costs so you can use secured loans for a higher amount of money and it also offers interests at better rates.
Despite many benefits, it also has some drawbacks like the customer has to make regular installments and if one does not pay these installments on time, then the lender can even sell the property that has been marked. The other drawback is that you could land yourself into serious financial problems if you face money losses like job loss, illness etc. So, it’s better that you opt for this option only if you have some sort of income protection.
Evaluation of other options in the financial market:
You can look up for other products like you can monetize of your assets, sells your shares, bonds or debentures. Also, the premature closing of your fixed deposits could be of great help. The best way to get funds is from the bank where your salary gets credited. As the bank knows your track record, your income or withdrawal transactions, the bank proves to be a better option before you for a secured loan and offer you a lower rate of interest.
In case you are self-employed, this option could be considered with the bank where you have the main account for your business transactions because the bank would be aware of the volume and nature of transactions done and could, therefore, offer you a better loan amount and rate.
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