7 Factors to Consider Before Applying for a Credit Card Loan

Though people try and save a portion of their earnings for the future, financial emergencies can negate it all. Whether it is a medical emergency, an urgent travel, or even a wedding in the family, you may need liquid cash to address your financial needs. In such circumstances, a credit card online loan can become your savior.

Let’s  understand in detail about credit card loans and the key factors you must consider before applying for one.

What is a Credit Card Loan?

You don’t need to use your accumulated savings or investments when in urgent need of funds. In the modern world, several options are available, using which you can access liquid funds while keeping your savings safe. One option is to apply for a personal loan. Although this is a trusted financing option, it can be time-consuming. Applying for loans could mean extra documentation and an approval procedure which could take some time.

On the other hand, credit card loan offer you the ease and convenience of quick funds in case of emergencies. Credit card online loans are unsecured loans that can be availed depending on the unutilised credit limit. These loans don’t require any extra verification or documentation procedures and don’t have any restricted use attached to their norms. You can apply for a credit card online loan after paying a small processing fee.

7 Factors You Must Consider Before Applying for a Credit Card Online Loan

Before you apply for a credit card online, you must look into some key factors such as:

1. Interest Rate

Remember that the interest rate is higher on credit card loans than on personal loans. You should apply for credit card loans only in case of dire emergencies and repay the loan as soon as possible.

2. Pre-Closure Charges

When applying for a credit card loan, you must read the terms and conditions carefully. Several credit card providers may apply pre-closure charges if you wish to close your loan before the stipulated time. You must keep a note of this and make partial or pre-payments if you have the arrangements for funds.

3. Loan Amount

Every credit card comes with a credit limit. If you have already used your card for purchases or cash withdrawals, the loan will be sanctioned on the remaining amount of the credit limit. It is advised to prefer a loan on a credit card rather than withdrawing cash to get favourable interest rates.

4. Loan Tenure

Flexible loan tenure is available in the case of online credit card loans. You can opt for a six-month short-term loan or a long-term loan for up to 3 years. You can modify the loan tenure according to your preference, budget, EMI requirements, and employment status.

5. Loan EMI

Use a credit card loan EMI calculator that helps you assess the amount of monthly installments. The EMI comprises the principal loan amount and interest factor. You need this free digital tool to calculate the amortization schedule (loan repayment plan) of your credit card loan and assess the total interest amount towards it. All you need to do is to put in your loan amount, loan tenure, and the interest rate offered by the credit card provider.

6. Top-Up Facility

If you are looking for extra funds in the future, you can easily get the loan top-up feature on credit cards. Again, this comes with no documentation and can easily be requested and processed based on the remaining credit limit

7. Effect on Credit Score

If you pay your credit card loan EMIs on time and don’t default on any payment, you can expect a positive effect of the same on your credit report. However, missed payment scan adversely impact your credit rating.


Now that you are aware of the key features of a credit card loan, you can easily apply for one and fulfill all your emergency fund needs.

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