Why you should avail a credit card loan?

Last Updated : June 27, 2016, 10:54 a.m.

Nowadays, having one or more credit card is a very common. In fact, many working individuals carry this plastic money for benefits. Because when it comes to credit card, it is actually a substitute, offering a line of credit. However, the best thing is that even if you are short on cash, also shopping is easy.

Apart from the credit limit and plenty of other amazing offers it helps getting a loan. Yes, it saves you from the rainy day by fulfilling your urgent need of money. Be it wedding expenses, medical emergency or  travelling, a credit card can solve many at once. So, without much ado, let’s take a look below.

Credit Card Loan – Things You Should Know

• No Documentation Required: When you avail a credit card loan, you don’t need documents for the approval. Usually, a loan depends on your credit spending as well as repayment habit. In some cases it can be pre-approved.
• Ease of payment: Credit card loans give you the benefit of converting your higher loan amount into pocket-friendly EMIs. So, according to your choice and convenience, you can choose any EMIs.
• Flexible Tenures: As far as credit card loan is concerned, different lenders offer different tenures for the same. So, you can easily choose a tenure that suits your repayment schedule well. Credit card loan tenures usually range between 6 months to 36 months being the maximum.
• Lower Processing Fee :With credit card loan also comes the processing fee that you need to pay to the lender. It is usually lower as compared to the fee or charges against the cash withdrawal.

Steps to Avail a Loan

1. Check your eligibility:

• Most banks offer pre-approved credit card loans based on your credit history and spending pattern.
• Check your online banking or mobile banking app for any pre-approved offers.
• You can also call your credit card issuer or visit their website to inquire about eligibility.

2. Compare interest rates and terms:

• Different banks offer varying interest rates and terms for credit card loans.
• Compare rates and fees from different banks to choose the most affordable option.
• Pay close attention to the interest rate, processing fees, late payment charges, and other terms.

3. Choose your loan amount and tenure:

• Consider how much money you need and how long you will need to repay the loan.
• Use an EMI calculator to determine the monthly payments based on the loan amount, interest rate, and tenure.
• Choose a tenure that allows you to comfortably manage your monthly expenses.

4. Apply for the loan:

• You can apply for a credit card loan online, through your mobile banking app, or by visiting a bank branch.
• The application process is typically simple and requires minimal documentation, especially for pre-approved offers.
• You may need to provide your basic information, credit card details, and income proof.

5. Review and accept the loan offer:

• Once your application is approved, you will receive a loan offer with the specific terms and conditions.
• Review the offer carefully and ensure you understand all the details before accepting it.
• If you have any questions, reach out to the bank’s customer service for clarification.

6. Receive the loan amount:

• Upon accepting the offer, the loan amount will be disbursed into your account as per the bank’s processing time.
• The amount might be credited instantly or within a few business days.

7. Make timely repayments:

• Make sure you make your monthly EMI payments on time to avoid late payment charges and damage to your credit score.
• You can set up automatic payments through your bank to ensure timely payments.

8. Manage your credit card usage:

• Be mindful of your credit card spending while repaying the loan.
• Avoid overspending and maintain a good credit history for future financial needs.

By following these steps and utilizing the resources provided, you can avail a credit card loan efficiently and manage your finances responsibly.