Personal loans are meant to pay for personal expenses such as home renovation, dream wedding, moving expenses, or debt consolidation. The money borrowed must be repaid over a set period of time, with interests. The terms for personal loans range from 12 months to 60 months, but occasionally online lenders may provide longer terms reaching up to 120 months.
Personal loans can be both secured and unsecured. With unsecured loans, the borrowers are not required to bring collateral against the money. While with secured ones, the borrowers bring a pledge as a guarantee for paying back the money.
Interest rates for personal loans may differ from lender to lender. The rates currently range from 5.99% to 35.99%. The rate of interest you have with the loan depends significantly on your credit score and credit history, income, existing debt, and the financial institution that provides the money. Personal loans are lent by banks, credit unions, and online lenders.
Get Your Money the Same Day
If you are in trouble and need cash fast, a same-say personal loan may provide the amount you need on the day you apply. Online platforms are intended to receive loan requests at any time of the day or night. These networks allow applying to different lenders simultaneously. As each lender competes for you as a potential client, you can have the best interest rates, monthly payments, and loan terms. After submitting the application, lenders can make a credit decision within seconds, and if approved, you receive multiple loan-offers from different lenders you should choose from. As you select the best opportunity, you should now complete the paperwork that takes an hour or less, and you can have your money sent directly to your bank account on the same day.
Same-day Personal Loans VS Installment Loans
Personal loans differ from installment loans in terms of their usage. Installment loans are used to fund specific expenses, for example, education, vehicle purchase, home purchase. Thus installment loans come in different forms, such as student loans, car loans, home loans, etc. Moreover, some personal loan lenders restrict the ways in which you can use a personal loan.
What to Consider Before Taking a Personal Loan
- Lenders offering personal loans usually pull the borrower’s credit. It is known as a hard inquiry that stays on credit reports and sometimes may affect credit scores.
- Defaulting on personal loans can add interest on remaining balances. Thus, the borrowers should keep an eye on the time frame and schedule their payments.
- To cover the debt in full according to the agreement with the lender, the borrowers should assess their finances and evaluate their ability to repay it. This may require a solid plan to avoid future troubles and feel more confident about repayment processes.
- As mentioned earlier, personal loans usually have associated fees that may include
- Establishment fee
- Servicing fee
- Early repayment fee
- Insurance fee
- Early exit fee
- Withdrawal fee
Realize all the expenses, consider the amount and decide which offer to choose.