Financial ups and downs are a part of everyone’s life. However, emerging from a financial crisis could take intelligent planning and research. There are several financial instruments available for this purpose. But you must choose the one that best suits your situation and requirements. Many people turn to a personal loan to pay off debts, ensure essential purchases are taken care of, or even keep a business running during a financial crisis. However, should you consider a personal top-up loan to help you get through the rough phase when you need money? The answer may not be straightforward, but we try to analyze and answer this question here.
What Is a Top-Up Personal Loan?
During a financial crisis, a person may have incremental financial needs. Bills that keep piling up and past dues that need attention can form a complex web in which you may feel trapped. At such times, a bank or financial institution may provide a personal top-up loan over and above the money you have already borrowed. This top-up helps you clear your total dues to get back on your feet.
The bank or financial institution will provide you with an additional line of credit if you have a good credit history. You can utilize this to deal with unforeseen emergencies and repay your debts according to your convenience. Thus, an immediate need for a large sum of money can be taken care of, and the repayment can be broken down into several manageable parts.
Can a Top-Up Personal Loan Be Helpful for You?
Taking a second loan may seem intimidating when you are already in debt, but many lending institutions have customer-friendly policies. These policies make borrowing and repayment much easier than before.
Short-term or emergency needs that come up unexpectedly can cause stress and derail a person’s plans. This can seem incredibly stressful when you have an existing loan. However, personal loan repayment options can be flexible. Attractive personal loan interest rates also make a top-up loan an accessible choice in your time of need.
Since personal loans are unsecured, you will not be forced to provide collateral when taking a top-up. The bank or financial institution will also not delve too deep into the purpose of the loan. This can give you great flexibility in your time of need. You only need a good credit history and a proven ability to repay the amount. These two factors will play a significant role in determining your loan eligibility.
Overcoming a Difficult Time
A personal top-up loan can be a good option when you urgently need a large sum of money but cannot arrange it yourself. Though a second loan may attract a slightly higher personal loan interest rate, you can borrow it for a short period and repay the amount as soon as your situation improves. The unsecured nature of personal loans and the repayment flexibility make them an ideal instrument to use during a financial crisis.
You should check a personal loan EMI calculator to determine your monthly payment and then decide. However, research to determine the best course of action for yourself. Though a financial crisis poses a big challenge, it doesn’t have to entirely derail your life’s plans. You can avail of a top-up loan to help you escape such a difficult situation more quickly.
