Top 5 things to consider before going for a consumer durable loan
Be it scorching summer heat or freezing winter cold, the demand for home appliances and electronic gadgets will never cease. You will want to buy consumer durable products like mobile phones, laptops, music systems, air conditioners, washing machines, televisions, microwaves, and refrigerators. Retailers and banks are alluring customers with various discount offers and financing options. Although one of the most popular options is a credit card, take a look at another option i.e. consumer durable loans, before you swipe your credit card.
Consumer durable loans are the funds that bank lends you to purchase a product on easy EMI repayment options. Moreover, you do not have to risk a personal asset for availing the loan and you get instant approval. Also, the eligibility criteria are not so strict as compared to other loans and there’s minimal documentation needed.
If you are planning to go for consumer durable loans, take a look at some of the most important things you must consider before you go for it…
While getting the consumer durable loans, the rate of interest should be one of the most important deciding factors, as it decides the extra amount that you have to pay other than the actual price of the product. Generally, the interest rate is low in CD loans as compared to that of credit cards or other types of loans. Some financial institutions also provide 0% interest offers on a specific range of consumer durable products.
The tenure of a consumer durable loan is the number of months that you will have to pay instalments and the amount to be paid every month. Usually, the number of months of tenure is between 3 to 24 months. However, it again depends on the financial institution and the product that you are buying. It is advisable to go for a low tenure so that you can repay off the loan as soon as possible without losing on to a lot of money as interest.
Generally, the banks provide loans for 80 to 95 percent of the total amount of product which means you have to pay rest of the amount as the down payment. So, make sure you check these details before applying for the loan so that you can be ready for the down payment amount.
The offer may state that there is 0 percent interest on a specific range of products. However, there can be other charges like processing fees. Also, there are clauses like you can not avail any discount on that product if you are going for a CD loan. So, it is quite possible that the ultimately you lose money in one way or the other.
Consumer durable loans are one of the easiest loans to avail because of the minimal documentation. All you need to submit is your identity proof, address proof, and income proof and you can avail instant approval.