how to manage your personal loans

How to Manage Your Personal Loan

Posted by on

People are all happy and excited when they take out personal loans, but soon they may discover that the repayment is harder than they thought it would be. Get some practical advice on managing your debt and avoiding default.

Prepare a monthly budget which provides for the payment of the loan instalments and all monthly bills. Try to manage your disposable income as effectively as possible. Avoid buying luxury goods and try to save on necessities by using coupons and special deals.

Always pay your instalments personally

Do not set up direct withdrawal from your bank account as the lender may add fees, which you did not expect, to the monthly payment.

If you find it impossible to pay the monthly instalments you must go to the lender immediately and ask for a loan extension. It is best to secure a longer term with lower monthly instalments. Even though you will pay interest for longer and most probably incur a penalty fee, the loan will become more affordable and you will avoid default.

Use these tips to manage your personal loans effectively.