When a Personal Loan Comes in Handy
Personal loans can be a good option for many different scenarios. You can pay for a house with a mortgage loan, or for a vehicle with an auto loan, or for college with a student loan. A personal loan can be used for anything you can think of, and for most lenders, as long as you're borrowing the money for a perfectly legit reason, you have the free rein as to what you want to do with it. Read onĀ  Bonsai Finance

Below are five situations where taking out a personal loan might be a great option:

Credit Card Consolidation

If you have maxed out one or more credit cards, a personal loan will let you consolidate all the charges into a single monthly payment. Here's makes this option more attractive: the interest rate could be significantly smaller than your credit cards' annual percentage rates (APRs).

Student Loan Refinancing

Depending on the type of student loan you have, your interest rate can be 6.8% or greater. But you can get a personal loan with less interest so you can pay off your loan or loans more quickly. Proceed here for more info

Purchase Financing

The decision to finance a purchase depends on whether it is a want or a need. If you're planning to get a loan anyway, obtaining a personal loan and making a cash payment to the seller could be much better than financing via the seller. Avoid deciding on the spot, however. Ask for an offer from the seller, compare it to what a personal loan can give you, then decide which one is more beneficial to you.

Covering Wedding Costs

Any big event - a wedding, for example - qualifies, if you end up charging all related costs on your credit card and are unable to repay them in a months' time. A personal loan for a considerable expense such as this can save you a lot in interest, as long as its rate is cheaper that that of yoru credit card.

Improving Credit

Finally, a personal loan can help your credit score in two ways. First, if credit card debt makes up most of your credit report, a personal loan can improve your "account mix." When you have various types of loans, it is usually good for your score. Second, a personal loan can bring down your credit utilization ratio, which is basically the overall amount of credit you're using compared to your credit limit. The less total credit you use, the better your credit score. A personal loan will help boost the overall amount this is available to you. View thisĀ  https://www.youtube.com/watch?v=5DXKOlr7SeI