The Indian economy underwent significant development, and the country’s GDP growth is expected to be about 6.8% as for 2019. The boost in the sectors of agriculture (15.87%), services (54.4%), and industry (29.73%) all contributed to this growth. However, such expansion has been possible due to the presence of substantial funding in the form of loans from various lenders across the country. While on the one hand multiple loans for personal and business purposes cater to the specific requirement with ease, on the other, repaying those loans incurs considerably more interest. A debt consolidation loan comes to the rescue in such cases.
Personal Loan from reputed lenders like Bajaj Finserv comes with no end use restriction and hence the amount so acquired can be easily used for debt consolidation. Thanks to such unsecured loans, you need not worry about repaying EMIs for multiple debts. Through this, you can also reduce the total interest amount paid for the loans availed, and you only need to pay the interest amount for the debt consolidation loan.
These unsecured loans come with multiple borrower-friendly features and easy-to-meet debt consolidation loans eligibility criteria. Additionally, certain lenders like Bajaj Finserv also bring you pre-approved offers on numerous financial products that include both secured loans like loan against property, and unsecured loans like personal loans, business loans, etc. These offers make the application process easier and save your time too. You can take a look at your pre-approved offers by providing a few essential details like name and phone number.
Despite multiple such benefits offered by personal loans to consolidate debts, there are a few misconceptions about such advances. Following are some such myths and why you need to ignore them –
Myth 1: Debt consolidation affects your credit score adversely
The common misconception about debt consolidation is that availing a personal loan and using the amount to repay multiple loans has a negative impact on one’s credit score. It further creates a hindrance in availing credits in the future.
However, instead of considering you credit-hungry, the reputed lenders will be looking into your timely repayment of the EMIs of the consolidation loans. Additionally, foreclosing all the other credits will have a definite positive impact on your credit score.
Myth 2: Consolidation of debt is a time-consuming process
According to many, taking loans to consolidate debts is a lengthy process considering the lengthy application procedure to avail loans.
On the contrary, availing loans from reputed NBFCs like Bajaj Finserv is convenient considering its highlighted debt consolidation loan benefits like instant loan approval and quick loan amount disbursal. This, along with various other features mentioned below, make such loans the best go-to option.
- High credit amount of up to Rs. 25 Lakh.
- A flexible tenor ranging from 1 to 5 years.
- No collateral required to avail the loan.
- Zero hidden charges.
- Nominal documentation.
- Attractive debt consolidation loan interest rates.
These loans come with minimum eligibility criteria that can be calculated by the personal loan eligibility calculator.
Myth 3: It does not save your money
Many individuals believe that debt consolidation loans do not save your money, instead, add up to your debts.
Conversely, loans taken for the consolidation of debts end up saving substantially, considering that now borrowers would need to pay a single EMI with a single rate of interest. This puts an end to the hassle created due to multiple repayments. It also helps individuals avoid any chances of defaulting due to missed EMIs.
Myth 4: Debt consolidation and debt management plans are the same
Just like not, every debt consolidation loan is not the same (you have secured and unsecured loans both used for debt consolidation). Similarly, debt consolidation credit and debt management plans are not the same. However, they are similar.
In the case of a debt management plan, the borrower under multiple debts approaches a credit counselling agency and seeks their expert financial skills to repay several existing loans. The monthly payment is made to the credit counselling agency who strategically reimburses the amount without any unnecessary stress on the monthly budget of individuals. Such agencies keep exceptional business terms with the lenders and hence are offered a curtailed cost of the loan. It helps in reducing the EMIs and is thus beneficial for the borrower.
Avail a personal loan to consolidate your debts and enjoy the foreclosure benefits from all the existing credits. However, make sure to look into your monthly financial obligations before opting to avail loan.