Personal loans are multi-purpose loans. They come handy when you want to meet any emergency or individual financial need. The loan is easy to avail nowadays due to the simplified digital application process. Personal loans are unsecured loans, and this is why they are available at a higher rate of interest to lessen the risk of default. Sometimes it becomes unaffordable for borrowers to pay back the loan. It is when they try to consider a balance transfer facility on their existing personal loan, which allows them to pay for their loans quickly. A balance transfer facility is opted when a borrower finds that another lender is offering a higher repayment tenure along with a lower rate of interest. Though it's convenient, it has its pros and cons:
Pros:
Pros:
- Availability of lower rate of interest
- Increased repayment tenure
- Easy to manage multiple debts
Cons:
- You need to pay the processing fee again
- There is no prepayment facility
- Might not be economical in the long run
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