Instant Personal Loans: Convenience Or A Financial Trap?

By Author: Shreya Eppili
Total Articles: 68
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In the current times, you may face a financial emergency anytime. Sometimes, money is urgently needed to pay a hospital bill, repair a house, or fulfil any other objective. Instant Personal Loans can help here. They can be issued within minutes and received the same day, which is why such Loans are popular now.
But the real question is, should one consider Instant Personal Loans a convenient financial instrument or a trap?
Instant Personal Loans appeal
Instant Personal Loans are famous for their speedy disbursement and approval procedures without much hassle. They are processed online and do not demand as much paperwork as other Loans that include credit checks and may take a long time to be approved. Funds are always assured within 24 hours, and they act as the best solution to any urgent money requirements.
Potential pitfalls
However, the availability of Personal Loans can, on most occasions, have the following drawbacks. One major issue is related to the interest rates. They are relatively higher ...
... compared to the other credits. Applicants who take such loans desperately need cash, and banks offer higher interest rates to manage risks. Instant Personal Loans come with higher interest rates than normal Loans, and this makes them costly in relation to the final amount borrowed.
Also, most Instant Loan providers charge other costs, like the processing fee or late payment fee, which comprise the Loan's price. Borrowers are also offered early repayment, which can make it difficult to adhere to the repayment plan’s terms and is often a financial burden.
Striking a balance  
How can we ensure an Instant Personal Loan will not be a snare than an instrument? First, it is necessary to compare the banks and read the descriptions given on the bank website more thoroughly. Indeed, there are some banks that have a slightly lower interest rate if you are blessed with a good credit score. As for the offers that seem better than the others, stay away from them because hidden charges accompany them.
Secondly, Instant Personal Loans are for emergencies only. For planned expenses, which include lower repayment terms and interest rates, it is more profitable to consider a low-interest Personal Loan.
Conclusion
Although Instant Personal Loans are highly beneficial when one urgently needs money, they must be taken cautiously. Measure the advantages and disadvantages and make sure that you are clear on the expenditure that you are willing to incur in each before opting for one.