Partial payments refer to the payment of an amount that is lower than the entire amount due for a money loan, a bill or an invoice. It is normally a percentage of the total amount or partial payment. This type of payment allows the borrower to pay the rest of the amount in installments.
Partial payment of an instant personal loan can happen when you have a part of lump sum money to pay for your requirement but is not equal to the entire personal loan amount. Partial payment is usually a good thing as it brings down your cash loan EMI and the total interest you pay.
Definition of Partial Payment
Partial payment, as the name suggests, is all about paying only a part of the total due amount. Whether it is for your credit card bill, loan payment, or other invoices, partial payment is quite helpful as it allows you to repay the total amount later.
What Are the Benefits of Partial Payments?
The major benefits of partial payments are as follows:
- Partial payments reduce the money you owe or your monthly instalments and help you manage your finances better.
- They are often easy on your budget when you are facing cash flow issues as you do not have to pay the full amount immediately.
- By paying a portion of the bill or loan, you can save on interest in the long run.
- Instead of defaulting on payments, you can make partial payments and improve your credit score.
- Partial payments also shorten the loan tenure by reducing the outstanding balance.
Reasons for opting for Partial Payments
You must opt for partial payments if you are looking forward to:
- Improving and maintaining a positive cash flow
- Managing unexpected expenses
- Avoiding late payment penalties or charges on your loan or credit card bill
- Having the financial flexibility to make payments when you can
Partial payment best practices
When making partial payments, it is important to follow some best practices:
Plan Your Finances: Before making a partial payment, make sure to plan your finances carefully so that you know the amount you are paying would not leave you short on cash.
Consider Interest Rates: Even with partial payments, keep track of the interest rates on your remaining loan balance.
Pay Installments on Time: Always make sure to pay your remaining instalments on time. This would help you avoid penalties and keep your interest charges as low as possible.
Consult with Your Lender: Talk to your lender before making a partial payment as they can provide advice on how much to pay and how it would impact your loan terms.
Check for Extra Fees & Charges: Go through your loan agreement to understand how partial payments affect your loan. Some loans may have restrictions or fees related to partial payments.
Also Read – How To Repay Your Personal Loan On Time
Conclusion
So, partial payments are perfect if you are looking forward to managing personal loans effectively. With CASHe, you can easily make partial payments on your instant personal loans including travel loans, medical loans and home renovation loans.
Download the CASHe app today!
