Alternative Title – Things to Keep in Mind to Never Miss Your Personal Loan EMI Payments
Competitive interest rates and minimal paperwork have made personal loans more popular than ever, especially among millennials, who fund even lavish goals such as travel plans and destination weddings using instant personal loans.
However, the natural human tendency is to care less about personal loan repayment as time goes on. People fail to discipline themselves long-term and miss out on EMI payments. And since defaulting can have significant repercussions, it is crucial never to skip an EMI payment.
Don’t want to miss another monthly installment? Follow the guide below to help make timely EMI payments on your personal loan –
Preparation is half-way to success. Before you apply for a personal loan, make sure that the EMI is within your repayment capacity. A hasty decision may end up pushing you in the default list. Evaluate your monthly budget, calculate your financial commitments, and determine the amount you’re comfortable paying towards EMIs. Ideally, at least 60% of your monthly budget must be kept aside for other financial obligations.
You can use a reliable online tool such as the personal loan EMI calculator to calculate your EMIs.
“Discipline is choosing between what you want now and what you want most.” And, you sure want to never default on an EMI payment of your personal loan. It is natural to be tempted to skip on EMI payments in favor of some other expense. However, the key to success is to stay disciplined. Keep aside the required personal loan EMI amount at the very beginning of the month and use the rest on other expenses. This will ensure that you do not default.
Despite all your efforts, you may find it challenging to stick to your personal loan repayment schedule. In such a case, it is best to automate repayment with the help of standing instructions. By automating personal loan EMIs, you can completely let go of any fears of defaulting. However, make sure to always have sufficient funds in your bank account for the same.
The consequences of defaulting on your personal loan EMIs can be grave, ranging from lower CIBIL score, late payment charges, to harsh legal implications. In most cases, you are aware beforehand that you may not be able to pay a particular month’s EMI. If that be the case, it is best to get in touch with your lender; they may be able to help you with debt consolidation or personal loan refinancing.
Choosing a longer personal loan tenure to pay lower EMIs may seem like an enticing choice; however, if you can manage a shorter tenure, opt for it. This is because with a longer tenure comes higher interest outgo. Meaning, ultimately, you will end up paying a lot more. Reducing personal loan interest rate will not only help you manage your EMIs better but will also enable you to close off your loan sooner.
As an additional tip, try opting for a higher down payment if possible to reduce your personal loan EMIs and compare between lenders to choose for one offering lower personal loan interest rates.
Want to take an instant personal loan? Lenders offer personal loans for self-employed and salaried individuals. Make sure to check your personal loan eligibility, determine the EMI amount beforehand, and then apply for your personal loan online.
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