Personal loans: These are the 5 key reasons to borrow money. Check list here | Mint

If you are falling short of money while you buy an important item for yourself or someone else, then you don’t need to fret. You can approach a bank to borrow money for a slew of purposes which are personal in nature. Whether you want to spend money on a wedding, or buy an expensive jewellery for your partner or want to go on a vacation — you can take a personal loan to meet your need.

Banks typically offer loans for a number of purposes which may range from buying a house to buying a car or for starting a new business. However, a number of purposes are often clubbed together and put under what is known as ‘personal’. And the loan granted for any of these purposes is known as personal loan. 

Here we list out some of the key purposes for which one can take a personal loan.

5 key reasons for raising a personal loan:

1. Wedding: Let us suppose that you have a wedding due at home, and are short of ₹5 lakh. What will you do in this case? You can’t of course postpone the wedding.

Alternatively, you may plan to spend lower than you had earlier planned. But since most of the bookings would be already done the more feasible option to do would be to take a personal loan to meet the expenses.

2. Vacation: Going on a holiday is no more a luxury but a necessity. So, if you want to go on a vacation and are still awaiting your annual bonus or the salary increment then you can rely on what is popularly known as a personal loan.

3. Expensive item for the loved ones: Another reason for which one might have to rely on a personal loan is to buy an expensive item for the loved ones. For instance, you may want to buy an expensive watch or jewel for your loved one on her anniversary then waiting for a few month to save money is definitely not an option. So, you can very well take a personal loan for the same.

4. Emergency situation: One more reason for which one should opt for a personal loan is when there is an emergency situation of any kind. Let us suppose, your child is unwell and needs an immediate treatment for which you have to take him to a good hospital in Mumbai.

The total cost may put your entire budget in disarray. So, the more feasible option for you is to take a personal loan.

5. House renovation: Although you may be eligible for home loan for the construction but after the construction is over, you may need more money for the renovation of house. As a result, what you can possibly do is to take a personal loan for the renovation of house.

(This is an indicative list)