PNN

Personal Loan Benefits to Tackle High Interest Debts

A personal loan refers to unsecured debt in which a person may borrow for several purposes, like consolidation and repayment of debts. Interest rates in personal loans are comparatively lower than those of credit cards, making personal loans more favourable as it will lessen the monthly amount of the interest payment.

Here are some key benefits of using FIRSTmoney personal loans for debt consolidation:

* Lower interest rate: Personal loan interest rate currently average around 10%, whereas credit card interest rates often soar past 20% or even 30%. You can save significantly on interest expenses by transferring credit card balances to a personal loan.

* Flexible repayments: FIRSTmoney offers a flexible repayment schedule ranging from 9 to 60 months. This structure helps with budgeting instead of varying minimum payments on credit card statements.

* Pay debt faster: With lower interest and flexible tenure options, you can clear your debt faster compared to making minimum payments on credit cards.

* Improve credit: Making on-time payments on your FIRSTmoney personal loan shows financial responsibility and helps improve your credit history and score over time. Good credit saves you money on future loans and offers more options.

Eligibility Criteria

To qualify for a FIRSTmoney personal loan to consolidate debt, there are a few eligibility requirements:

* Credit score – Borrowers require a credit score of 730 or higher for approval. The higher your credit score, the lower the interest rate you can qualify for.

* Income – Lenders will review your income, employment status, and debt-to-income ratio to determine if you can manage the loan payments and your other living costs. Stable income increases your chances of approval.

* Loan purpose – FIRSTmoney personal loans allow flexible use of funds for any purpose, including debt consolidation, medical emergencies, educational fees, or more.

* Collateral not required – A big advantage of FIRSTmoney personal loans is that no collateral is needed. Your creditworthiness determines if you qualify, not assets.

Tips for Success

When using a FIRSTmoney personal loan to eliminate credit card and other high-interest rate debt, follow these tips:

* Make a budget – Use FIRSTmoney’s personal loan EMI calculator to plan your repayment. Clearly see how much you can afford for your monthly new consolidated loan payment. Account for other living expenses so you don’t take on too much debt.

* Use auto payments – Set up automatic payments from your bank account to avoid ever missing payment due dates for your loan. This protects your credit.

* Stop using credit cards – After debt consolidation, avoid relying on your cards for purchases to prevent returning to credit card debt. Use debit, cash, or budgeted spending from income instead.

* Use prepayment options: Take advantage of FIRSTmoney’s zero foreclosure charges to pay off your loan as soon as possible without incurring any prepayment fees.

Conclusion

Debt consolidation can be a game-changer when managing multiple high-interest loans, and FIRSTmoney from IDFC FIRST Bank makes the process effortless. With competitive interest rates starting at 10.99% p.a., a fully digital application, and zero foreclosure charges, FIRSTmoney empowers you to take control of your finances.

Whether you’re looking to streamline your debts or secure better repayment terms, FIRSTmoney provides a smarter, more affordable solution. Apply today and experience the ease of managing your debt with FIRSTmoney–where financial freedom is just a click away.

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