The growing availability of online loan apps has prompted a remarkable change in people’s psychology worldwide. Online loans from apps like opay, which once used to be considered the last resort in times of financial crisis, are now the first thing to come to mind even during a minor financial inconvenience.
A major reason for this shift in perspective can be attributed to the fact that online loan apps, like the okash loan app, have leveled up their offerings in ways that make it easier for everyone to avail of a loan. Consider loan tenure, for instance – online loan borrowers are no longer bound by stringent repayment tenures pre-set by the lenders. Rather, some apps let borrowers choose the repayment tenure, allowing borrowers with special circumstances to avail of online loans.
However, a major concern that arises in hindsight of this newer change in perspective is the misuse of online loan apps like the palmcredit loan app. Not everyone can be assumed to be a responsible borrower. Thus, this article highlights some questions that every loan borrower must ask themselves to become a responsible borrower.
1. “Do I really need a loan?”
The need to get a loan is an important consideration. Loans, whether taken online through an app or through physical paperwork, are a responsibility. Before going forward with a loan arrangement, it’s best to search for alternative financing options. Are you getting a loan to finance your education? Try scholarships. Is the loan for a small expenditure? Check if you have some investments that you can liquidate.
Conversely, borrowing a loan may be beneficial even when you have enough savings to cover yourself. For example, when you want tax exemptions. Thus, the decision to take a loan should come down to what is in your best interest.
2. “Will I be able to handle the repayment?”
Many loan apps have a built-in EMI calculator to help borrowers estimate their monthly payments. However, borrowers should always be aware that any figure generated by the calculator may not be realistic.
Suppose the EMI is 2/3rd of your monthly income. At a glance, it may seem like the repayment would be easy because the EMI is still below the monthly income. Well, not always. You can’t realistically estimate your ability to manage the repayments unless you have a clear picture of your monthly expenditures. That’s one case. There could be many others.
It’s best to have a well-thought-out and secure repayment plan in place before getting an online loan. When gauging your repayment capability, consider your monthly income, expenditures, liabilities, emergency funds, investments, and savings.
3. “Is the lender reliable and legitimate?”
As a general caution, every loan app – get cash instantly, asks the borrower to carefully read the terms before signing the agreement. It’s not just because they want borrowers to be responsible for the undertaking of the loan, but also because they want borrowers to be able to understand if they’re borrowing from safe sources.
The loan agreement alone can uncover a lot about the lender. If you come across any terms that state that certain parts of the agreement are prone to changes without any prior notice, it’s best to investigate the legitimacy of the lender. Regardless, look for past reviews, licenses, and associations with legitimate credit administration organizations in the country.
The Bottom Line:
Borrowing a loan is only a good decision if it’s done thoughtfully. It’s essential to understand your repayment capability and the terms of the loan before signing any agreement. Additionally, it’s also important to consider the passive benefits that a loan may get you. Ultimately, the choice of borrowing should stem from what’s best for your financial future.