What are Personal Loans?

Personal Loans are the loans provided by the lender to the eligible borrowers without any limitations on the use of the loan amount. Whether it be a medical emergency or any sudden financial need, personal loans are always there to help you financially. The loans are unsecured making it convenient for the people to avail it. 

Though it has many advantages and benefits, people do not consider a personal loan for the long term. You must be thinking why is this so?

The answer is many people are not even aware that a personal loan can be availed for the long term. There is a typical mindset persisting that personal loans are only short term loan and it can’t be availed for long tenure period. 

What is a Long Term Personal Loan?

Personal Loans with a tenure period of more than 3 years is known as a long-term personal loan. Many of the lenders provide personal loans for a long period which is of 5 years and also can be even more. 

Generally, the personal loan comes with a higher interest rate as compared to secured loans, and this is the reason people hesitate to go for a long term personal loan. Paying high interest for a longer term may end up by paying more on the interest. 

Things to consider while going for a long term personal loan

  • Decide your loan amount carefully, don’t opt for more without calculating your requirements.
  • Before applying for a personal loan, calculate your Personal Loan EMI to figure out your monthly cost.
  • Remember for a long-term personal loan, you may need to put the collateral. 
  • Interest rate of the loan

Purposes to avail a Long-term Personal Loan

  • To pay medical bills.
  • To bear the cost of your expensive car repair
  • Debt Consolidation, by paying lumps multiple debts in one short.
  • To bear the cost of loan Refinance, which could lower the rate of interest.
  • For higher education
  • For business expansion
  • For home construction

Let us Consider Pros & Cons of Long-term Personal Loan


  • If you take a personal loan and make timely repayments against it, the credit bureaus may consider it “good debt”.
  • Repaying it on time will increase your CIBIL Score.
  • Whether consolidating or refinancing your debt with a long term personal loan, it may come at a lower interest rate hence you need to pay lower EMI monthly.
  • Going for a long term personal loan reduces your financial burden as you need to repay it for a longer tenure.
  • The monthly payments may be smaller if you opt for a longer term, but you must also consider the amount the interest rate.


  • Along repayment term for a personal loan means you’ll be paying more on the interest over the time as compared to a shorter-term personal loan.
  • If you want to close your long term personal loan account early, you may be charged some fees against it.
  • A long term personal loan means you need to accommodate for the debt for a much longer time than for a shorter-term loan.

Are Long-term Personal Loans Expensive?

You can’t come to the conclusion that a long term personal loan is expensive or not. The cost of your loan always depends on two factors

1. The amount you are borrowing

2. The time period for which you are borrowing.

A long-term personal loan can act as a great financial tool when used wisely. Go for it only after considering other options too. Remember going for a long term loan is a big financial commitment, when not taken care properly can lead to serious issues in the future.

Always think wisely and then opt for a loan term personal loan. You always have options to pre-close it, making it worth at the time of need. 

Your needs and requirements matters, so there is no best loan if one suits your requirements and needs then that makes it best for you. Same is true with a long term personal loan, if it suits your requirements and you are looking for a loan then long term personal loan is best for you.