Instant Loan Myths Busted: What You Need to Know Before Applying
With instant loan apps, it’s like getting an emergency ATM for most people, who just want to access money without any hassle. But amidst all this, myths around instant loans are doing the rounds, which are leaving many confused and hesitant. Be it a home loan, personal loan, or exploring an instant loan app, it’s time to separate fact from fiction. Let’s bust some common myths and help you make smarter financial choices.
Myth 1: Instant Loans Are Only Required for Emergencies and Nothing Else
Reality: Think instant loans are strictly for emergencies? Think again! Sure, they’re perfect for those unexpected situations like medical expenses or urgent repairs, but their versatility doesn’t end there. Want to fund your dream vacation? Spruce up your living space? Or consolidate debt? An instant loan can help you do it all. Contrary to tied purposes home loans, instant loans leave it up to you to determine how to use the cash. Today, with these instant loan apps at your fingertips, financial flexibility never gets better than this.
Myth 2: Instant Loan Apps Are Not Safe
Reality:Many people feel apprehensive about using these instant loan apps due to security reasons. However, most sites ensure that you are perfectly safe with highly evolved encryptions and data protection measures. Before you jump, ensure that it is registered, under RBI guidelines, and privacy policy is open. To put it bluntly-if you don’t have home loans from such renowned lending institutions, such genuine quick loan apps function under certain regulations that prevent fraud with your best interests. Therefore, some small amount of research goes in the best interest.
Myth 3: I Need to Have a Great Credit Score
Reality:Here’s the good news: you don’t need a high credit score for instant loans. Although that will certainly increase your chances of getting approved, several lenders will consider other things, like your income and repayment capacity, as well as your employment history. Unlike home loans, where stellar creditworthiness often comes into play, instant loans are more inclusive for people with moderate credit scores.
Myth 4: Instant Loans Have Hidden Charges
Reality: No one loves unexpected costs, and the best thing about genuine instant loan apps is that they clearly display charges upfront. From processing fees to interest rates and penalties, they are open to you. Just as it is with home loans, the fine print matters. The main source of most hidden charges is the unknown lenders. So do well to avoid them. Only reputable apps will get the job done for you, hassle-free.
Myth 5: Instant Loans Are Expensive
Reality: Yes, instant loans might carry higher interest rates than secured loans like home loans, but they are not as expensive as they are portrayed. It is more of a small premium paid for the speed and convenience. Shorter tenures also mean you will clear your debt faster and avoid prolonged interest payments.
Myth 6: You Can Borrow Unlimited Amounts
Reality:Instant loans won’t exactly take you straight to unlimited funds. Rather, it all depends on how eligible you are to get it, and there might be an upper amount decided by the app policy. Instant loans are made to serve minor, on-the-go requirements. And for larger purchases, for instance, if you have your eye on a property, a home loan may do the trick. Knowing the purpose and constraints of each type of loan will better enable you to make choices that will suit your monetary goals.
Myth 7: Long Time Taken for Approval and Disbursal
Reality:Speed is the name of the game with instant loans. Unlike home loans, where it takes weeks for their approval and disbursal, instant loans live up to their name with approvals happening in minutes and funds showing up in your account in hours. Of course, accuracy in your application works in your favor to not delay the process.
Myths 8: Instant Loans Harm Your Credit Score
Reality:Instant loan does not mean doom for your credit score. In fact, timely repayments can increase it. The real threat is frequent borrowing and missed payments, which can pull down your score. As with home loans, the golden rule is responsible borrowing.
Myth 9: Instant Loans Are Only for Salaried People
Reality:Instant loans are not just for salaried professionals. Self-employed, freelancers, even business owners can apply provided they meet the eligibility criteria of the app. In contrast to home loans that demand extensive documentation, instant loans are simple and easy to access.
Myth 10: Prepayment of Instant Loans Incurs Heavy Penalties
Reality:While some lenders may charge prepayment fees, many instant loan apps offer the flexibility to repay early without penalties. Like with home loans, knowing your lender’s policies upfront can save you from unnecessary costs.
Tips to Know Before Applying
- Do Your Research:Compare different instant loan apps for interest rates, repayment terms, and customer reviews.
- Evaluate Your Needs:Determine whether an instant loan or a home loan is better suited for your financial requirement.
- Read the Terms:Always read the terms and conditions thoroughly to avoid misunderstandings.
- Borrow Responsibly:Take only as much as you need and ensure timely repayment to maintain a good credit score.
Conclusion
Instant loans are an excellent financial tool when used wisely, but misconceptions can lead to hesitation or poor decisions. By debunking these myths, you can approach the process with confidence and make informed choices. When dealing with trusted financial partners such as Bajaj Finserv, making the journey of loans more accessible and secure is relatively easier.
