Have you seen Lindsay Lohan lately? Babygirl is just GLOWING. 🤩 We’ll have whatever she’s having. Christina Aguilera, too. Screw it, let’s all get personal loans and head to the nearest Instagram plastic surgeon (*looks up flights to Turkey*). 👄✈️
Whether you need some extra cash to redo the kitchen or to pay those pesky medical bills, a personal loan could really come in clutch. 💸 However, before you pull the trigger, there’s a lot to consider.
Here’s Five Fast Facts on personal loans:
- 🤔 Taking It Personally - Personal loans (AKA unsecured loans) can be used for everything from home improvements to credit card debt consolidation. The “unsecured” nature of these loans means you don’t need any collateral. However, interest rates tend to be on the higher side.
- 📈 Very Interesting - One of the most important factors to consider on a personal loan is the interest rate. The interest rate determines how expensive your loan is. High interest rates mean higher monthly payments. Also check to see if rates are fixed (won’t change through the life of the loan) or variable (changes depending on the market). Compare rates with multiple lenders so you get the best deal.
- 💳 Where Credit Is Due - How do you get the best interest rate? Put up a high credit score. A score of 750 or more usually leads to the most competitive rates. If you don’t have a great credit score, it might be worth working on it before taking out a loan. Pay all of your bills on time, pay off credit card balances, and stay under 30% of your available credit limit.
- ⏳ The Long and Short - Personal loans also come in different amounts and repayment schedules. A longer repayment schedule might get you a lower monthly payment, but you’ll pay more in interest over time. Consider your overall budget and financial plan to choose the best option.
- 🕵️ Mind Your T’s and C’s- Don’t skip over that fine print! In a loan’s Terms and Conditions, you’ll find all the rules about prepayment, penalties, and payment schedules. Some loans charge extra if you want to pay it off early and most (if not all) charge fees for late payments. It’s not exactly a beach read, but knowing what’s in your agreement saves you from surprises down the road.
🔥Bottom line: You can get a personal loan through your local bank or credit union. You can also get one through a Fintech bank - that’s fancy finance speak for “bots over brick and mortar.” Can you trust a bank that’s completely online? In this article, we spill all the tea about Fintech banks and if they’re a safe place to park your paychecks.
Shopping around for a personal loan?
Let us know by connecting with us on Facebook and Instagram! Also, remember to share this newsletter with your friends & coworkers!
Btw, If you’ve read this far and haven’t yet signed up for the weekly Paycheckology newsletter, CLICK HERE!
