Get the Tata Capital App to apply for Loans & manage your account. Download Now

Blogs SUPPORT
Loans For You
Loans for Business
Investment
Insurance
Apply

Quick Links for loans

Quick Links for Insurance

Investment

Offers Quick Pay
Back

Equipment Finance

Avail Digital Equipment Loans
up to Rs. 1 Crore

  • Attractive ROIs
  • Customizable Loan tenure
Know More
Back

Equipment Leasing

Avail Leasing solutions
for all asset classes

  • Up to 100% financing
  • No additional collateral required
Know More
Back

New Commercial Vehicle Financing

  • First time user
  • Retail and strategic Clients
Know More
Back

Used Commercial Vehicle finance

  • Repurchase
  • Refinance
  • Top up
  • Balance Transfer
Know More
Menu  
 
Apply Now

Tata Capital > Blog > Personal Use Loan > How a Personal Loan Is Better Than Borrowing Money from Friends or Relatives

Personal Use Loan

How a Personal Loan Is Better Than Borrowing Money from Friends or Relatives

How a Personal Loan Is Better Than Borrowing Money from Friends or Relatives

When you need to arrange funds quickly, it is easy to look to your family or friends to borrow a sum of money. While your loved ones might be supportive and willing to help you out, you must accept that sometimes, unexpected situations arise. Here, by mixing financial and personal matters, you can risk your relationships.

When you need financial help, taking a personal loan from a financial institution is a better option and here’s why.

Clarity of loan details 

When you borrow money from friends or relatives, you do not record the transaction details or sign any documents. You also do not spell out details like interest rates, loan tenures, or repayment options. Verbally agreeing to loan terms may lead to confusion and disputes during the loan repayment. 

Therefore, it is prudent to approach a lender. All terms and conditions are clear when you apply for the loan, and you can always contact the lender’s customer service to clear any doubts. 

Easy repayment with EMIs

When you borrow funds from a loved one, you do not chalk out a repayment plan. You only decide on a date by when you will return the amount as a lump sum. If you fail to repay by that date, you risk your relationship with that person. 

But if you avail of a loan, you can pay in EMIs. Use a personal loan EMI calculator and decide your future EMIs to conveniently repay the loan within your monthly budget. 

Additional Read: Rules to Follow When Taking a Personal Loan

No conflict of interest

While borrowing from a family member or friend, it is an unspoken agreement that they will charge no interest on the amount borrowed. If you borrow money and do not return it for many years, your friend might lose the interest income they might have earned by investing the money elsewhere.

Therefore, it is wise to take a loan from a lender. Nowadays, you can easily compare multiple loan offers online to get the most competitive personal loan interest rates.

Avoid fallouts in your relationships

Consider the following scenarios: 

#1 Your friend who lent you the money is faced with an unexpected financial crisis, leaving you feeling guilty. 

#2 You fail to pay your loved ones back on time, resulting in distrust and awkwardness every time you interact. 

#3 You grudgingly admit your financial difficulties to your friends and family when you would rather have them not know. 

#4 You might end up making your relationship bitter due to an argument or a dispute. 

#5 Your inability to repay borrowed money might affect your reputation in your social circles. 

One of the benefits of a personal loan over borrowing money from your friends is freedom from unpleasant situations like these.

Additional Read: How to Apply for a Personal Loan in 5 Simple Steps?

In conclusion

Taking a loan from a credible lending institution can save you from jeopardising your relationships with your near and dear ones. If you are in need of quick funds, Tata Capital is here for you. We offer collateral-free personal financing at competitive interest rates and flexible repayment options.

Visit our website to check your personal loan eligibility and apply today!

Apply Now

Get an Instant Personal Loan for all your needs !

Apply now
Popular Searches
loan without cibil personal loan for 15000 salary Loan for ring small cash loan on aadhar card pre approved personal loan What To Buy On Dhanteras Personal loan when self employed how to increase cibil score form 15g for pf withdrawal how to download aadhar card
Disclaimer

Most Viewed Blogs

Trending Blogs

Calculator

Personal Loan EMI Calculator

Personal Loan EMI Calculator
Home Loan EMI Calculator

Home Loan EMI Calculator
Business Loan EMI Calculator

Business Loan EMI Calculator
Used Car Loan EMI Calculator

Used Car Loan EMI Calculator
Two Wheeler Loan EMI Calculator

Two Wheeler Loan EMI Calculator
Loan Against Securities Calculator

Loan Against Securities Calculator
Loan Against Property Calculator

Loan Against Property Calculator
More Tools
Our Subsidiaries
Our Other Websites

Useful Links and Resources

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Policies, Codes & Other Documents

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Tata Capital Solutions & Services

Uh oh, something went wrong

Please try again later.