Those who say they are in control of their finances might be true but those who believe that their finances will never reach a point of stress are truly mistaken. There could be a possibility that you had taken a loan to remodel the house, send your kids to college or to finance a new section of your store but suddenly you find yourself short of cash to pay for another dire need.
Whatever be the reason, you might be thinking of opting for a second loan but are really wonder if you can have two personal loans at the same time. While a simple answer is yes because there is nothing stopping you from getting two or even more loans however, in reality, things are much more complex than a simple yes or no.
A second personal loan warrants multiple considerations
It is always prudent to consider the implications your loans have on your life in general and finances in particular. There are multiple factors to consider before you start comparing second personal loans.
- Every additional loan increases your debt to income ratio. This indicates how much of the income you earn goes into repayment of the instant cash loans or other loans that you have taken.
- Your ability to get loans at competitive rates reduces drastically. Lenders can view your credit history and will know that with higher debt to income ratio, your ability to pay reduces.
- Credit score will also take a hit. The lenders will have the full report in front of them and they can see multiple fast cash loans in succession. This indicates that you are in a debt cycle and will not go down well with them
- Your monthly budget will always be spread thin since a majority of your income might be going into repayments.
There is no harm in going for a second personal loan
Financial stress can come to anyone and in multiple form and shapes. Banks and other lenders are always there to help you take care of your immediate cash requirements. The only thing that you need to be careful about is to not going beyond your means by taking massive loans which you cannot repay regularly. Missing your loan repayment is the worst thing that your credit score can experience next only to not paying back the loan at all, which will make you ineligible to take formal loans in the future.
In some cases, when people want to access more money, there is an option to refinance the existing loan to a higher amount. This enables you to access more cash instantly, without having to take out a second loan that reflects in your credit report. You can check out many online portals that provide quick and easy loans for smaller amounts without taking any security against the amount. The only downside of unsecured loans is that their rates are a bit on the higher side however, you do not risk the loss of assets in case you are unable to pay back the loan amount.
