Some of the best reasons to give for a personal loan will help you to obtain funding from the government, bank, or private lender. These are reasons that are of importance and as such, will require the dire help of others. Moreover, the first thing each of these lenders will want to know is the cause you’re going to put their money to. Is it good enough or are you going to squander it once it lands in your hands?
In the same vein, there are lenders who may want to take it one step further by carrying out an investigation to ascertain if the reason you have given is true. Therefore, whichever reason you’ve stated, must be the truth. These aside, here are some of the reasons to give while applying or asking for a loan.
Best Reason to Give to a Bank for Personal Loan
The best reasons to give for a loan are:
1. Medical purposes:
Life is the most important thing and as such, if you or a family member is ill, then that’s enough reason to obtain and be granted a loan. Considering the fact that medical expenses are high, your savings may not be enough to cover it. And one thing about the health is, it could be an emergency which was not foreseen and as such, your unpreparedness. Therefore, you can pay for a medical procedure with a loan.
2. Starting a Business venture:
This is one of the best reasons to give for a loan since the business has a higher potential to grow with the right amount of funds pumped into it. If you have a good business plan and can see where your business is headed to in the next 5 to 10 years, then you can present it to a lender and convince them to give you a loan. If you get the loan, your business can be expanded while you maintain the monthly payment with the inflows from the business.
3. Home improvement:
Remodeling or redecorating your home comes with a cost and that’s a cost you may be unable to cover by yourself. Your savings may go a long way to improve its outlook, but may not still be enough to cover it. However, obtaining a loan that only requires a down payment and some fees is an attractive package.
Your lender may be willing to cover 80 percent of the cost you need to remodel the home, which means you can use part of your savings to cover the other and still have something to fall back on. At this point, that the 20 percent will be the ownership you have on your home, and if it’s worth increments over the years then you can enjoy more equity from it.
4. Debt consolidation:
If you have several loans and from a different lender, it’ll definitely be difficult to manage the monthly payment. In the same vein, each of these will have a different interest rate even though very similar. The latter means that you’ll have to be making higher returns. But then, obtaining a personal loan to pay off those you currently owe comes with a promise of helping you manage your loan better.
It also seeks to lower the monthly payment and as such, you win on both side. That being the case, this also makes a good reason to give for a loan you want to apply for. You can also use this method to improve your credit score and establish a more stable payment history while handling a few debts.
Other reasons you can give for a loan are:
- Cover your wedding cost
- Have an emergency fund
- Pay off credit card debts
- Purchase a car, bike, refrigerator
- Take a dream vacation or honeymoon
Whichever is your reason for obtaining a loan, it is also your part to speak convincingly to your lender on why you need it. If it’s the truth and is as important to them as you’ve presented it, then chances that you’ll obtain it are high. Nevertheless, asides from giving a reason, lenders also have criteria such as good credit score, collateral, etc. before issuing a loan. If you’re unable to obtain the loan, then it is not entirely because your reason was not good enough.