Personal Loan is a kind of loan, which is obtained by a customer for catering to their personal needs such as purchasing a vehicle, wedding, home appliances, education, renovation, and much more. It is offered to you only after checking your capability to pay back the loan, the source, and amount of your income, and most importantly your credit ratings/history.
You will have to bear a processing charge in order to get the amount (as per your paying back ability) credited in your bank account. The repayment of the loan is done in the form of fixed instalments including the interest charged for a fixed period. With the increase in expenses, personal loans come in handy these days. You need not go through heavy paperwork or lots of formalities. The personal loan interest rate in the UAE is also considerably reasonable. You can easily compare personal loan interest rate to find the best personal loan in UAE. You can also take personal loans for purchasing.
Benefits of a personal loan in the UAE
As discussed above, personal loans can be used for a variety of purposes in the UAE. Here are some of the advantages of personal loans:
Obtaining personal finance in the UAE won’t be counted as a very difficult task. Personal loans are offered at low rates of interest by most of the financial institutions and banks in the Emirates. It is usually simple and convenient to opt for these loans when compared to other kinds of loans.
No middleman or agent involved
To get personal finance, you don’t need to approach an agent or a middleman. This way you can avoid useless expenses and delays. You can approach the financial institution or bank directly for this purpose.
Another benefit of personal loan in the UAE is that it takes less time for processing. Since personal loans in the UAE are available without any guarantee or security, the processing time to get it is also less.
You don’t have to necessarily mention the reason for opting for the personal loan. You are free to use the amount that is credited to your account for any purpose (only legal, obviously). It is up to you to decide what you would be doing with those funds.
Opting for a personal loan does not involve verification of any of your assets. It does not include verification of other types of certificates and proofs that involve too much paperwork, because no property is being mortgaged.
Tenure and amount
The maximum loan amount may vary from bank to bank; however, most of the banks in the UAE offer high amounts as a personal loan. You can make repayments through simple instalments. The tenure of the loan is based on the amount borrowed. Usually, the maximum loan tenure is 48 months.
It is mostly recommended that you get a personal loan rather than borrowing cash through your credit card. This is because the rate of interest is comparatively less and there are various benefits of personal loan. Although applying for personal loans to meet urgent financial needs is simple, but you might sometimes come across some problems, especially when you apply for the first time. There are chances you get confused while choosing the right institution to move ahead with this. You would wish to choose the bank or financial institution that is offering you the most suitable rates.
Why you need personal loans?
In case you urgently need funds for some reason, nothing can beat the suitability of personal loans in such situations. Here are some of the requirements for which you might need personal loans.
Consolidation of debt
At times, we might be stuck with the liability of paying more than one loan at the same time. And to add more to the misery, there can also be an outstanding debt on your credit card. Now, all these debts have different rates of interest. In this case, banks give you the option of selecting a single loan for a certain eligible amount according to your requirement. You can clear all your past dues using personal loan. It gets easier to figure out the time of paying off all your debt without being too burdened.
Paying off credit cards
Rate of interest on credit cards is generally higher than the personal loan interest rate. If you have been trying to clear the debt on your credit cards but are struggling because of the high amount, you can get a personal loan for paying it off. You can pay back the loan amount in the form of instalments as determined by the concerned financial institution or bank.
If you plan to get a new roof, put solar panels, modify your kitchen, simply build a swimming pool, or add landscapes at your home, a personal loan could be of great help.
For wedding preparations
A personal loan can be used for wedding purposes too. You can use it for things like the dress of the bride, venue, and for small expenses such as wedding photography, flowers, decorations, and more.
Paying medical bills
Medical expenses have grown tremendously in the past few years. Treatments such as fertility, cosmic surgeries, etc. are all considerably expensive for normal households to afford. With the kind of available benefits on a personal loan, it can be possible to meet such requirements.
For financing a new business
Personal loans are also there to help you in your plans for starting your own business. You don’t need to delay it anymore.
We all want to plan that dream vacation, but it is not necessary that we all have enough money for our vacation. With personal loans, you can plan that dream holiday, and relax & rejuvenate without stressing about the funds.
The final words:
A personal loan is a loan that you choose in order to fulfill your financial emergencies or personal expenses (if any). This loan does not involve any collateral. It is offered by a financial institution or bank at the personal loan interest rate. The lenders check your personal credit history and monthly salary to determine the eligibility for the personal loan and deciding their terms and rates.