5 Circumstances in which a Personal Loan is Good Idea
Some loans are reserved for a specific purchase like you buy a home with a mortgage loan, you purchase a car with an auto loan and you pay for college with a student loan. But a personal loan can be used for just about anything. Some lenders want to know for what reason you are borrowing a loan, but as long as the loan is borrowed for a responsible and legal reason, you can use loan amount wherever you wanted to.
A personal loan often has no collateral—it is “unsecured”—the interest rate will probably be higher. There are also secured personal loans if you want to lower your costs.
Here are five circumstances in which a personal loan might be a good idea.
1. Consolidate Credit Cards
2. Refinance Your Student Loans
3. Finance a Purchase
4. Pay for a Wedding
5. Improve Your Credit
The Bottom Line
Personal loans can be useful, given the right circumstances. For example, most people can’t afford a luxurious wedding but getting a loan for a wedding can help them to afford their dream wedding. However, be sure to consult with a trustworthy financial institution and weigh your options carefully and wisely.
A personal loan often has no collateral—it is “unsecured”—the interest rate will probably be higher. There are also secured personal loans if you want to lower your costs.
Here are five circumstances in which a personal loan might be a good idea.
1. Consolidate Credit Cards
2. Refinance Your Student Loans
3. Finance a Purchase
4. Pay for a Wedding
5. Improve Your Credit
The Bottom Line
Personal loans can be useful, given the right circumstances. For example, most people can’t afford a luxurious wedding but getting a loan for a wedding can help them to afford their dream wedding. However, be sure to consult with a trustworthy financial institution and weigh your options carefully and wisely.
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