How to Get a Loan for a Family Function?

Loan for family functions

Family functions are a great way to meet up with all your long lost relatives and catch up with their lives. However, these functions inevitably become grand social events that also lead to huge expenditures. From arranging for food and beverages to having music or social activities, these entail expenses that spiral out of the reach of your monthly salary.

This is why many people apply for a family loan in the form of a personal loan. This ensures that your loved one’s happiness is not compromised with, and you can bear your own or your family member’s expenses by borrowing from the banks or a lending institution.

Applying for a Loan for a Family Function

Individuals often choose to go in for a personal loan when there are big occasions and family functions around the corner. Today, the cost of expenditure when it comes to a wedding, grand birthday party or any other family celebration is huge.

When you decide to apply for a personal loan, the borrower that is the lending institution or the bank requires some information from you. The information consists of the following.

  • Your monthly income, that is your in-hand salary after subtracting your EMIs and other necessary financial obligations
  • The details of the organization you are employed in
  • Your monthly expenses
  • Assets and liabilities
  • Your CIBIL credit score

Banks charge for their loan in the form of rates of interest on the loans. You will be informed about necessary information such as the interest rate that is to be charged on the loan as well as the tenure of the loan. If you are already an existing customer with the bank, it definitely ups your amount when it comes to securing your loan.

Everything You Need to Know about These Loans

You don’t have to worry about obtaining the loan amount as long as your paperwork is in order and all your details are accurate. These interest loans are taken by people to meet their personal expenses so there is no specific purpose for using these loans. Generally speaking, these kinds of loans are taken to meet a family oriented expenditure. This can either be a son/daughter’s marriage, a lavish vacation, a home purchase or a family function.

These loans are classified into unsecured personal loans and secured personal loans. While a secured loan needs the borrower to attach collateral or assets at the time of taking the loan, when it comes to unsecured loans, you do not need to attach collateral or assets. Since unsecured loans are a risky affair, they usually come with a high interest rate. Interest rates are usually noted on a yearly basis.

All you have to do is the following.

  • Check out the loan eligibility criteria before applying for a loan
  • Verify your own credit score. Anything above 750+ will keep you in good stead for a personal loan approval
  • Avoid applying at various places as the lenders keep a track of existing applications and may so second guess your intentions
  • Set up a sensible loan amount
  • See that you are stable in your job
  • Offer correct and appropriate facts and figures

Repaying These Loans

When it comes to sanctioning a loan, in today’s times, banks have let go of their leniency and have become more stringent in their ways. When you get too far behind in repaying your interest rate loan, the loan is charged off. This can affect your credit score to a great extent. Lenders usually check your repayment ability prior to sanctioning the loan for family function. Nevertheless, it is always better to apply for a loan amount depending upon your ability to repay the monthly payments in time.