Main image via Shutterstock
You’ve heard of car loans and housing loans—these are the ones you’re most likely going to get, or have already gotten.
But did you know that you’re also able to take a personal loan if you need money for other reasons? You can borrow up to RM150,000 and the interest rates depends which bank you choose.
While there are a bunch of documents you’ll have to show the bank to make an application, the most important things that will affect their decision to approve a loan are your credit score and proof that you’ve been earning wages.
So why do people take personal loans? We’ve always assumed they do it to pay for their house or a wedding ceremony—but it turns out that there are even more reasons! Read on:
#1 Going on a vacation
Image via Pexels (Te lensFix)
So you’ve been a workaholic and want to go on a holiday. Why not? Sure, you could opt for a cheap way of travelling, but sometimes it’s okay to want a luxurious vacation with your loved ones. Believe it or not, some people actually take out personal loans to go on an epic trip of their lives!
#2 Buying household items
There are people who take a personal loan to afford buying expensive items they may need for their household such as a washing machine, refrigerator and couches. This is usually done by those who just moved into a new home or are newlyweds.
#3 Death in the family
Funeral arrangements can be expensive—Chinese funerals, for instance, can cost up to a whopping RM15,000. There may be a situation where the death is so sudden that the deceased’s family members could not withdraw money immediately to bear the cost. And sometimes, extra expenses is needed to pay for other things such as bills and school fees.
#4 Medical emergencies
Medical problems happen can happen unexpectedly. In some cases, maybe they don’t have a medical insurance to help them out, and this leads them to applying for a personal loan to cover surgery and hospitalisation costs.
#5 Paying off debt
People have known to take a personal loan to pay off their debts. Not the best idea—but it happens. They do this so that they can pay their credit card debt, or money they owe other people.
#6 House deposit
Image via Pexels
If you’re buying a house that’s still be constructed, it’s likely that you don’t have to pay a deposit. But if it’s a second-hand house, you need to pay at least 5% to 10% deposit before you sign the Sales & Purchase Agreement (SPA).
#7 Buying a car
You would need to pay a deposit if you want to get a car, regardless whether it’s used or not. The more you pay, the lesser your monthly deductibles are. There are also people who take a personal loan to buy a used car by cash.
As you’ve read, there are a mixture of reasons people apply for a personal loan. So, whether you want to go on that Maldives honeymoon or renovate the living room, you can! Click here to find out how you can do that.
If you are planning to take a personal loan, you might want to answer these questions too:
#1 Do I have enough money to pay back my personal loan?
#2 Have I chosen the right back to apply for a personal loan?
#3 Do I have a good credit score to apply for a personal loan?
#4 What are the hidden charges and fees incurred when I apply for a personal loan?