You must have worked hard for your entire life and now going at ease with pension coming in your bank account. It is essential as well in your old age but suddenly you found that there is some urgency and you need money but you don’t have as much as you require. Now you cannot go without money and have to get it from some place. You have worked the whole of your life for others and don’t have anything left with you to give a guarantee against your loan that is a must to furnish. Now you are into confusion and are thinking to borrow against pension by putting your hard work at stake. There are a few consequences as if you are unable to repay the amount then how will you survive.
Keep some backup ready
If you cannot manage without the required money and have to take a finance alternative from another place then it is a must that you should have a backup plan. Without having that it is going to be very risky to take money as you have to repay the same and with that you have to pay interest additionally. Therefore, it is a must to have some source from where you can get all these things in an appropriate manner. In the case, if you are thinking to borrow some funds via putting your pension as a guarantee then you must ponder a few points before doing that.
- Do you have an additional property or house to sell? It should be extra and not the one you are residing at. If you have one then you can take the peril easily.
- You must also brood over that you property is in your own name and whenever you need to sell the same then you can do that. If it on the name of your partner or someone else at your home then you cannot take the menace on its basis and it will not act as a backup at all.
- Maybe you have your fixed deposit in a bank and cannot break it for your reasons. If you have it in your own name then you can consider it as a backup and can take the jeopardy.
- If you have some jewelry of your own or else of your partner then you can mull over it under your backup plan and can take the risk on its basis.
- You must be calculative and need to do it for the interest you have to pay your loan amount. You must estimate you regular expenditure and interest amount and now your pension amount. It is quite easy and you can add the previous ones and subtract from the amount of your total pension. You are quite old and can decide on your own if it is going to be a sensible decision then you can take it.
Now you can take a risk that is calculative one by doing a thing like borrow against pension is possible for you.