Consumer Goods Financing: Commonly Asked Questions

The joy of buying and making your own house after all is simply the best joy on earth. The contentment of making thoroughly researched and careful choices with your partner is inimitable. When we say “making” a house, the thought of buying several utility goods comes to mind. Goods that we call consumer goods, which lend face to your brick-and-mortar house.

Now it could be furniture or decorative furnishings or even the latest technological gadgets included to add convenience to daily living. Again, not everyone may be as lucky to make these purchases comfortably from their monthly salaries. But does that mean not making these purchases at all? No, it simply means getting them financed by a third party, which we call consumer goods financing in business terms.

Here are some of the common FAQs people ask about financing consumer durables before they take a dive into it.

Top FAQs for Consumer Goods Financing

1.          What is Consumer Goods Loan?

A: A consumer durable loan implies a credit or financing option for the borrower, which facilitates the latter to make purchases of certain utility goods, such as household appliances or electronic gadgets.

2.         What are the prerequisites of applying for a consumer durable loan?

A: Banks and other financial institutions would typically look into your annual earnings and credit score, before considering to grant you such a loan. Also, consumer durable loans are unsecured loans so this means that the lender would look into your credit history and repayment history too (in case you’d applied for a loan in the past).

3.         What are the rates of interest and processing fees involved?

A: The interest rates essentially vary between different lenders. Ideally, you may expect something between 12 and 22%. You may also be lucky to find some lenders who might offer 0% interest rate as part of promotional offers. The processing fee for consumer goods financing too is fairly nominal ranging between 1-3% of the total loan amount.

4.        What is the duration for which the loan is granted?

A: Consumer goods loans are usually lent for a flexible time duration ranging from 8 months to 3 years.

5.         Anything else I need to look out for before applying for one?

A: Yes, it’s always advisable to do your homework well before applying for any loan. This holds true for consumer durable loans as well. Visit a few reliable and trusted lenders, make queries on their respective interest rates, processing fees charged, and other charges applicable, if any. Make comparisons before arriving on the final decision. This would of course depend on who you think offers the best deal.

Consumer durables are a must for every household. You need them sometimes as decorative items but more often than not, your life literally comes to a halt without them. Washing machine, home theatre, and microwave are some examples. Availing of a good consumer goods loan option can make things easier for you in no time.