What is the better in the credit card or a Personal loan?
Credit Card or a Personal Loan – It is your choice
Particular Loan and Credit Card Loan are the quick and easy loan options presently. My friend had recently bought a flat. After the exhausting his home loan limit he was a looking for the spare 3 Lakh to the complete innards of his home. The only option left in the front of him was to conclude for the another loan. He was the approached the bank and described his problem. The bank director gave him two options. (1) Particular Loan of the 6 Lakh on a flat interest (2) Credit card loan of 3 Lakh. He was a confused and looking for the answer which bone he should conclude for- credit card loan or Particular loan? If you’re also in a similar situation also’s an answer to the your question.
Credit Card Loan or Personal Loan – It is the your choice
What’s Credit Card Loan?
Credit Card Loan is the relaxed loan offered in the terms of cash advance, balance convert or purchase. This loan is the offered to the credit card in the holder. You need to the pay back loan amount in the future by the due date.
What’s Personal Loan?
Particular Loan is loan given to the existent predicated on the credit history, income, and repayment capacity. Repayment in the case of the particular loan is bt the fixed amount installment over a fixed term.
How to the Select between the Credit Card Loan and Personal Loan?
It’s delicate to make a choice between the credit card loan and particular loan as both of them sounds similar. Still, following points will be help you in taking the correct decision.
Credit Card Vs Personal Loan
Personal loan and loan on the credit card feel similar but aren’t exactly the same.
- Attestation A Particular loan requires quite a number of the documents for the blessing and takes a numerous days to the come through, still loan on the credit card doesn’t need any documentation and is the hastily to attain.
- Interest This is the most important point to be considered while taking the loan. Generally, person loans are the offered at a 13-22 interest rate, while the credit card loans offer interest rate of the 10-18. Still, another pivotal factor is that credit card loans can be a served at flat interest rates, while particular loans are the available with the reducing balance rates. Yearly interest in the case of flat rate loans is applied on the original loan amount and it remains the same for the entire duration of the term, indeed though the top amount diminishments. While in case of the reducing balance loan, the interest outpour decreases as and when the star is paid.
- Relaxed Loan Still, both these loans are the relaxed and there’s no collateral involved.
- Tenure Credit card loans can be a taken for the lower term periods, while Particular loans are a generally long duration loans.
- Loan Quantum A credit card loan is a suitable option when in the need of a small amount of the loan, while with particular loans, you can be avail a huge loan.
- Operation Process – Operation process in the both of the loan is a different. Credit card loan is a accessible are easily. You just need to the walk into your bank and conclude for this loan. In case of the Particular loan you need to the submit form 16, bank statement, income substantiation and KYC document for a loan operation. Processing time in the case of particular loan is the longer compare to the credit card loans.
- Processing figure and pre check the charges – Processing figure in the both of a particular loan and credit card loan are same. It’s generally in the range of the 0.5-1. The pre check charges in the both cases would be in the range of the 2-5. In a credit card loan you can lower in the term of a loan by the making pre-payment. Still, the particular loan comes with the fixed duration of the 12-24 months.
- Loan Quantum – A Personal loan is a more suitable for a advanced amount. If you’re looking for the small amount credit card loan could be a suitable option. In this loan you’ll get amount up to the your credit limit.
- Interest Rate – Interest rate plays the vital part in the comparison. A Particular loan is a offered at the interest rate of the 13-22, still, credit card in the loans are offered at the 12-15. The rate of the interest depends upon a bank. Particular loans are the offered in two variant flat and reducing balance rate. In flat rate, interest amount is a advised flat on a entire star. On the other hand, in reducing balance rate interest amount will be calculated on the reduced star.