When Should You Opt for Personal Loans With a Longer Repayment Term?

Many people rely on personal loans to cover their immediate funding needs as they are readily accessible online. Loan seekers can obtain them hassle-free at attractive interest rates and with minimal documentation. NBFCs like Clix Capital offer the option to spread EMIs over flexible repayment terms. Short-term and long-term loans have pros and cons, unlike your never-ending bills, which have only cons. 

Here, we will look at a few situations when you should opt for a personal loan with a longer repayment term.

  • You want to Borrow a Loan, but with a low Financial Burden

Life is already full of burdens like what you should wear to the office or what song to loop to while taking a shower. In the midst of this, the financial burden is the last thing you want on your plate. The best thing about borrowing a long-term loan is that it significantly reduces the monthly debt burden. Those with a tight budget would want to cover their expenses with a loan but do not want to increase the financial burden beyond their monthly repayment capacity. Opting for a long-term will keep the monthly EMIs low and make repayment manageable without straining the budget.

  • You want to improve your credit score with a ersonal loan 

Those cheesy crust pizzas have not improved your immunity despite many attempts, but personal loans can surely help you to improve your credit score. Many people have sufficient funds to cover their planned or unplanned expenses. Still, they take a loan to build their credit score as it helps improve your credit score and build creditworthiness. 

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Once the credit score reaches a higher threshold, the individual becomes eligible for a bigger loan in the future with favorable terms and conditions. However, building credit with a loan takes time. Opting for a more extended repayment tenure helps improve the credit score over time. Such applicants get a low personal loan interest rate and more enormous loan sanctions.

  • You want to borrow a substantial loan amount while keeping the EMIs manageable

Even when you borrow a substantial loan amount, an extended repayment tenure gives breathing space while keeping EMIs manageable. Despite a high loan amount, the long term keeps the EMI amount low, allowing you to repay the loan gradually in easy installments. The strategy is particularly helpful for those who wish to consolidate their debt and repay it conveniently over several years.

  • You want free cash for other financial obligations

Since a longer repayment tenure comes with smaller monthly payments, it gives more flexibility within a limited budget. If you have limited income with several financial obligations to cover each month, opting for a longer personal loan term will keep some free cash to handle all commitments easily without straining the budget.

  • You don’t mind being indebted for longer

A longer loan term keeps the borrower indebted for longer. Many borrowers do not want that, as becoming debt-free is the ultimate financial goal for many. However, opting for a longer repayment tenure will keep EMIs manageable if you don’t mind staying indebted for an extended period.


There are several situations when opting for a longer repayment term is beneficial. It might come with a higher personal loan interest rate but it will benefit you in the long run by keeping the EMIs affordable and building credit scores over time.

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About the Author

Amaira Sharma is finance expert and former business growth strategist who has more than 8+ years experience in the industry, now she helps others to get better financial stability and standards. She loves to write useful tips on personal finance and businesses.

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