If you want to consolidate high interest rate credit card debt, a personal loan could be a good solution. With a personal loan, cash is typically deposited into your bank account, which means you can use the loan for any purpose. With the rise of online lenders, shopping for a personal loan has never been easier. You can check to see if you are approved and receive your interest rate without hurting your score.
You can use our tool below to find the best deal. To learn more about personal loans, Click here.
6 things to know
Beware the sale of expensive add-on insurance, and the use of a “pre-computed interest” contracts.
These are basically tricks banks use to squeeze more money out of you. We break them down HERE.
Make sure there is no pre-payment penalty.
If you pay off the entirety of the loan early to save money, don’t let the bank charge you.
Origination fees are usually financed, so always apply for the amount you want to borrow + the fee.
So if the fee is 3% and you want to borrow $100, then apply for $103.
Come prepared with documents to prove your income.
This typically includes paystubs, 1040s, and tax returns.
Make sure you compare APR, not just interest rate.
APR includes the cost of the origination fee, which can be a big part of the loan.
Start the process at LendingClub and Prosper.
Shop around. Applying won’t hurt your score at most lenders.
Compared to the complexity of credit cards, personal loans are much simpler products. You borrow a fixed amount of money for a fixed period of time. In most cases, the interest rate is also fixed. You know the interest rate before you sign the dotted line, and the proceeds are given to you in cash. Personal loans are becoming increasingly popular, because online personal loan companies are making the application process much simpler.
When shopping for a personal loan, make sure you compare the APR of the different offers. The APR will include the interest rate and the fees. And you should only compare the APR at the same term.
If you need money on the same day, you will have to visit a personal loan company that has a branch office. At the moment, only Springleaf and OneMain have branches. At both places, an application received before noon can be funded the same day. The fastest an online lender can offer money is 24 hours, and Avant is the fastest of the group.
Competition continues to heat up with personal loan providers. That is good news for borrowers. Just make sure you don’t borrow too much money. Only borrow what you need and keep that budget discipline.
If you have questions, you can set up a free consultation to discuss your options. You can arrange your appointment on our Customer Service page. We look forward to hearing from you.
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