Life happens. No matter how much you might plan and save, water heaters break, once-in-a-lifetime appliance sales come along, unexpected wedding or school expenses arise. This is exactly why you might be exploring top reasons for getting a personal loan.
Whether a large one-time purchase like a home renovation, new or used car or you want to consolidate debt, a personal loan can have real merit. Let’s take a look at personal loans and how to use them.
Unsecured personal loans: Most people opt for this type of personal loan. They don’t require collateral and often come with a higher interest rate.
Secured personal loans: Backed by collateral like your home, car or savings, secured loans usually come with a better interest rate.
Variable-rate personal loans: With a benchmark set by banks, the interest rates on these loans can rise or fall over the life of the loan, which means they’re most valuable to those who can pay it off in a few months.
Co-signed personal loans: These loans are secured by a cosigner who agrees to pay the balance if you’re unable.
What can I use a personal loan for?
The best time to take out a personal loan is when doing so helps you make (or save) money in the long run. If you have a large one-time expense approaching and you are asking yourself, “What can I use a personal loan for,” check out this list of the top 8 reasons to consider a personal loan:
Let’s walk through the pros and cons of each scenario.
Debt consolidation loans
If you’ve carried a credit card balance, you know interest can add up! If you have debt you can’t pay off within a few months, personal loans for debt consolidation let you roll multiple loans into a single (often lower) payment.
For example, if you have a $2,000 balance on your credit card, a $5,000 high-interest car loan and $4,000 payment plan for emergency home repairs, you could consolidate these into one $11,000 personal loan.
Theadvantages can includeone monthly payment and a lower interest rate than you’re paying now, which can save you hundreds of dollars each year.
Home remodeling loans
Whether you have a new house or a hundred-year-old character home, you may have big plans for making it your own. A personal loan for home remodeling is a great fit if you want to:
Get a loan even if you don’t have much equity in your home.
Faster funds when you’re mid-planning and other financial sources fall through.
Fixed monthly payments with no hidden fees, if you work with a lender like Greater Alliance Federal Credit Union.
A boost in your credit rating if you pay off the loan on time.
Personal loans for vacation
Is the beach calling your name? Dreaming of some quiet time in the mountains? When you find a travel deal you can’t pass up, personal loans for vacation can make your dream trip come true.
Get quicker access to funds, so you can take the trip you’ve been putting off.
Skip the worry of adding to credit card debt.
Instead of emptying your savings, pay off your trip over a period of two or more years.
If you have unexpected emergencies to cover, consider an unsecured personal loan for:
Much lower interest rates.
More time to pay off the loan – usually about two years.
A better chance your credit score will actually see a lift, if you pay it off on time.
Fewer costs to you in the long run.
A loan for moving expenses
In a perfect world, you’ll always have time to plan and save for a move. In reality, there are sudden job opportunities and rental property sales that can mean a quick move. Apersonal loan can be a big help.
Keep moving costs off credit cards. It can save hundreds or thousands in interest costs.
Spare your emergency fund. Rather than dip into savings, pay moving costs back over a period of years.
Secure a loan fast. This lets you take advantage of a job opportunity or cheaper living space in a high-rent area.
Plan for the unexpected. Get money for your move and extra funds to cover any surprise costs.
A personal solution for life’s surprises
At Greater Alliance, we offer low personal loan rates, and the only fee we charge is a late fee. We can also provide faster approval than other bigger financial institutions, excellent customer service anda variety of loan options based on your needs.
If you’re looking for a way to fund that thrilling home remodel, your ongoing education, emergency expenses and more,contact us. We’re happy to walk you through yourpersonal loanoptions and help you determine what financial moves are right for you.
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