If you need money and don’t have access to home equity or credit cards a personal loan might be the best way to get cash fast. A personal loan is an unsecured loan because there is no collateral to back up the money borrowed as with a home loan or a car loan. This creates extra risk for the lender and a personal loan will nearly always have higher interest than other types of loans.
If you have bad credit getting a personal loan can be difficult but there is usually a lot less paperwork than with other types of loans. If your credit score is good you should be able to get a personal loan quickly.
Here are some key tips for when you want to find the best personal loan:
- A personal loan will have higher interest than a secured loan but usually lower than a credit card.
- The interest rate is usually fixed and the term can be fixed as well so you need to be sure that you’ll be able to make the payments on time.
- If you can get a home equity loan that is usually a better source of cash because the interest is tax deductible and interest on a personal loan is not.
- Different lenders will have different fees and terms for getting a personal loan so make sure that you shop around for the best combination of fees, interest, and term. These loans are generally best to only use for emergencies because the total of payments will be considerably higher than the principle borrowed.
Advice on getting the best personal loan:
When you are looking for a personal loan be sure to check the interest rate, penalties for early repayment, payment terms, fees, late charges, and any application fees. Make sure that you compare options from several different lenders to get the best deal.
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