A personal loan is a type of unsecured loan where you borrow money from a lending source and repay it over time. It’s important to note that this amount will not be paid back in one lump sum and will be spread out over a certain period of time. Usually, personal loans are given by banks, but they can also be given by other institutions such as new age loan apps, private lenders, or friends and family.  A personal loan can take different forms such as payday loans, installment loans, student loans, etc.

Things to Keep in Mind While Taking a Personal Loan

Always keep in mind that a personal loan is not a long-term solution. You will have to pay the loan back, and this means you will have to make payments on time. Personal loans come with a lot of fees, so it’s crucial that you know what all these fees are and how much they charge before you take one out.  If you decide to take out a personal loan for your rent deposit, make sure that you use the money for its intended purpose only – paying your rent deposit.  

How much can you borrow with a personal loan?

The amount you can borrow with a personal loan depends on various factors. The most common ones are your credit score, and the amount of time you will have to repay the loan. In India, there is a limit on how much you can borrow in case of a single loan. 

What is the interest rate for personal loans?

The interest rate for personal loans in India is pretty high. So, you will have to pay a lot of interest if you borrow money from a bank. However, with the help of personal loans, the interest rate on your loan can be reduced drastically. If your credit score is also good enough to qualify for this type of loan, then you will be able to get a much lower interest rate that’s not too much different than what you are paying on your rent deposit. 

Should you take a personal loan for your rental deposit?

If you’ve ever looked for a personal loan in India to pay your rent deposit especially when your old deposit is stuck at the previous landlord’s, then you know it’s not an easy task. There are multiple factors that come into play when you need to find a loan provider. You need to make sure the loan provider is reputable and will offer a good interest rate on your personal loan. The other factor is affordability. You need to ensure that the interest rates offered by the lender will not be too high or too low for your budget. It all depends on what you can afford and how much time you have to repay the loan back as soon as possible.

Should you compare personal loans to find the best one?

If you need a personal loan to pay your rent deposit in India, you might want to compare the rates of personal loans. When comparing rates, make sure you take into account the timeframe of the loan. The longer the loan period, the higher the rate will be as well. One way to get a personal loan is to take a Personal loan offered by instant personal loan apps like PaySense. There is little paperwork here and the approval process is easy and the disbursement is quick.  

Bottomline

If your rental deposit is stuck at your old landlord’s end, and you are in immediate need to pay the new rent deposit at your new home, there is no need to worry. You can avail of a personal loan from a Personal loan app to meet this expense by checking your personal loan eligibility.

Anil Sumra

Anil Sumra is a Digital Marketing Expert with more than 10 years of experience. He loves to write on various financial topics online to create financial awareness. He holds a bachelor’s degree in Finance & Management.

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