A
personal loan is the easiest and quickest loan option in today’s market. It
does not take a lot of days to get it approved and has a quick approval
procedure if you fulfill the required criteria. Banks
these days give you an instant Personal Loan approval on the basis of your
credit score, employment status, repayment history (credit card payments), age,
etc. While you can opt for a personal loan for many reasons, one of the reasons
can be financing your business. Many would say to go for business loan if you
are looking to fund your business but that can be tricky. Here are some of the
reasons why a personal loan makes sense to finance your business.
To Start a New Business Venture:
When you want to start your own business, you will surely
encounter some obstacles on the way. Taking up a business loan is a little hard
for a brand new business organization. It is best to opt for a personal loan in
the early stages of your business so you can get your business started.
The Amount
Required Is Less:
A personal loan makes sense if the amount you require for your business
is not substantial. A business loan is best if the amount you require is
quite large. It would also take a lot of time as the procedure takes more days
when compared to personal loans. Business loans also require a lot more
documents when compared to personal loan. For a business loan, documents
include business model, service taxes and more. A personal loan is quickly approved and is easily available.
No Collateral or Guarantor Needed:
For a
business loan, your company’s reputation, credit history and cash flow are some
of the factors that are considered. You will be asked to keep something as
collateral too. Whereas in a personal loan, they are given to an individual.
The bank or a financial institution will evaluate your personal income, credit
history, bank details rather than that of your business. Personal loans are
more flexible and allow you to use the funds as you wish to. In comparison with
business loans where you have to keep something as collateral, personal loan do
not ask for any collateral.
Freedom of Using the Amount As You Wish:
In a business
loan, there are very strict terms how you use the money. You cannot use the
money as you wish to. A business loan is taken so that companies can pay for
expenses that they are unable to pay. They are used to pay for salaries until
the company is stable. They are also used to fund office supplies and projects.
You also have to show the lenders where you used the borrowed money. While in a
personal loan, the amount is given to an individual. There are no questions
asked where the money is going to be used. It is your wish how you use the
money in helping your business grow.
A
Personal Loan can do you no harm unless you do not make the monthly payments
and pay your dues on time. You do not need to be afraid of a Personal Loan
anymore. All you need now is to research about which bank gives you the best
option on easy approvals, hassle-free documentations and lowest Interest Rates.
You can compare all this on several online loan aggregators, such as www.paisabazaar.com and know more. Each bank has a different set of
payments options and pre-closure rates. Make sure you find everything before
going in for the loan which will only benefit you. Consider these scenarios to
learn if a personal loan is the right match for your business.
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