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Personal Loans

Santander Personal Loan Review

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

APR

6.99%
To
16.99%

Credit Req.

Not specified

Terms

24 to 60

months

Origination Fee

No origination fee

SEE OFFERS Secured

on LendingTree’s secure website

Advertiser Disclosure

Santander’s personal loan might be a great option for you if you want to work with a traditional brick-and-mortar bank. ... Read More


To get a Personal Loan (“Loan”) with the Annual Percentage Rate (APR) shown, you must reside in MA, MD, RI, CT, NH, NJ, PA, NY,DE, ME, VT, or DC, meet our highest credit standards, and use automatic payment (ePay) from any Santander Bank N.A. checking account. Fixed loan APRs (with ePay) range from 6.99% to 16.99%, depending on your creditworthiness. The minimum Loan amount is $5,000 and the maximum is $50,000. The APR on the Loan will increase by 0.25 percentage points and the payment will increase, if ePay is not elected or is discontinued. APRs and other terms are accurate as of 10/01/2018 and may change thereafter. A Santander checking account is not required to qualify for a Loan, but use of ePay from a Santander checking account will result in an interest rate discount. Personal Loans cannot be used to finance post-secondary educational expenses. Loan accounts are subject to approval.

Santander personal loan details
 

Fees and penalties

  • Terms: Terms range from 24 to 60 months.
  • APR range: Loan APRs range from 6.99% to 16.99%. If you do not elect for ePay, your APR will be 0.25% higher.
  • Loan amounts: You can borrow a minimum of $5,000 and a maximum of $50,000.
  • Origination fee: There is no origination fee for Santander personal loans.
  • Prepayment fee: Santander has no prepayment penalties for personal loans.
  • Other fees: There are no application or annual fees.

Eligibility requirements

Although Santander doesn’t provide explicit credit requirements to qualify for a personal loan, it does state that borrowers must meet its “highest credit standards” — however, there is no specific credit score requirement listed.

When you apply, Santander will review your score and your debt-to-income ratio, among other factors, and your APR will vary according to your creditworthiness. You do not have to have a Santander checking account to be eligible for a personal loan, but without one, you won’t qualify for the APR discount.

Santander also requires that you live in one of the following states: Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Vermont, as well as Washington, D.C.

Applying for a personal loan from Santander

You can apply for a Santander personal loan online. If you choose the latter, expect the process to take 10 to 15 minutes. You’ll need the following information to complete your application:

  • Social Security number
  • Employment history
  • Income information

Santander allows co-applicants on personal loans. You’ll be asked to provide that person’s information as well.

Pros and cons of a Santander personal loan

Pros:

Cons:

  • Low rates. Santander has lower starting rates than many lenders, although those rates are reserved for borrowers with the highest credit scores.
  • Minimal fees. There is no origination fee. The lender also doesn't charge application, prepayment or annual fees for personal loans.
  • Term options. With terms ranging from 24 to 60 months, you have the option to pay your loan off quickly or over a longer period.
  • Limited to borrowers in certain states. Santander only serves personal loan customers in states that have — or are near — brick-and-mortar branches. If you live outside of the Northeast or Mid-Atlantic, you likely won’t qualify.

Who’s the best fit for a Santander personal loan

If you are looking for a lender you can meet with face-to-face, Santander is one to consider. Thanks to the residency requirement to apply for a personal loan, you won’t be far from a bank branch if you’re actually eligible for its services.

Santander’s loan terms (24 to 60 months) give borrowers a lot of flexibility to pay off their loans quickly or reduce their monthly payments by extending the term out longer. Many personal loans have terms of 36 or 60 months, so if you’re looking to minimize the time you carry this debt, Santander might be a good option for you.

Santander has reasonable rates compared to other lenders — its highest APR is set at 16.99% with the ePay discount — though you will need a good credit history to qualify. These loans are also good for those who want to avoid fees. Assuming you make your payments on time, you are unlikely to owe anything extra.

Santander consumer reviews

Santander has an A+ rating from the Better Business Bureau but has received mixed reviews from borrowers on LendingTree (MagnifyMoney’s parent company), granted there are few reviews to glean information from.

One consumer review praises the bank’s customer service, while another notes that the loan application process was slow and the customer support poor.

Keep in mind that Santander personal loans are only available to borrowers in a few states. One advantage to working with Santander is that a brick-and-mortar bank won’t be far away, so if you have customer service concerns, you can meet with an employee face-to-face.

Santander FAQ

Santander offers personal loans as well as personal lines of credit. The bank also finances auto and home loans.

No, but you’ll get an interest rate discount if you make loan payments using a connected Santander account.

No, Santander personal loans are unsecured, which means you don’t have to put up assets to receive funds.

There are very few limits on how you can use the cash from your personal loan. Santander doesn’t allow you to finance post-secondary educational expenses, but home improvement projects, vacation cost, debt consolidation and other areas are fair game.

One benefit of a personal loan (versus a line of credit) is that you’ll have consistent and predictable monthly payments. Of course, if you choose to pay your loan off more quickly, you may pay more in some months. Santander doesn’t charge a prepayment penalty, so paying your loan off early could save you some interest.

Santander may charge a fee for late payments.

If you don’t meet Santander’s residency or credit requirements, not to worry. There are other lenders that might work for you.

Alternative personal loan options

Upgrade

Upgrade
APR

6.98%
To
35.89%

Credit Req.

620

Minimum Credit Score

Terms

36 or 60

months

Origination Fee

1.50% - 6.00%

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on LendingTree’s secure website

Advertiser Disclosure

Upgrade is an online lender that offers fairly priced personal loans for a term of either 36 or 60 months.... Read More .


Personal loans made through Upgrade feature APRs of 6.98%-35.89%. All personal loans have a 1.5% to 6% origination fee, which is deducted from the loan proceeds. Lowest rates require Autopay and paying off a portion of existing debt directly. For example, if you receive a $10,000 loan with a 36-month term and a 17.98% APR (which includes a 14.32% yearly interest rate and a 5% one-time origination fee), you would receive $9,500 in your account and would have a required monthly payment of $343.33. Over the life of the loan, your payments would total $12,359.97. The APR on your loan may be higher or lower and your loan offers may not have multiple term lengths available. Actual rate depends on credit score, credit usage history, loan term, and other factors. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. There is no fee or penalty for repaying a loan early. Personal loans issued by WebBank, Member FDIC.

If you need your loan quickly, want to check rates without impacting your credit, or need to borrow less than Santander’s minimum loan amount, online lender Upgrade is a good option. Fill out an online form to apply for personal loans between $1,000 to $50,000 — you’ll receive a decision almost immediately and your money within four business days of approval. Loan APRs range from 6.98% to 35.89%, higher than many other lenders, and terms are set at 36 or 60 months. To be eligible for the best rates, you’ll need to sign up for autopay. Upgrade does charge an origination fee of 1.50% - 6.00% and may assess other charges and fees over the life of your loan.

Marcus by Goldman Sachs®

Marcus by Goldman Sachs®
APR

6.99%
To
28.99%

Credit Req.

Not specified

Terms

36 to 72

months

Origination Fee

No origination fee

SEE OFFERS Secured

on LendingTree’s secure website

Advertiser Disclosure

Marcus by Goldman Sachs® offers personal loans for up to $40,000 for debt consolidation and credit consolidation. ... Read More


Your loan terms are not guaranteed and are subject to our verification of your identity and credit information. To obtain a loan, you must submit additional documentation including an application that may affect your credit score. Rates will vary based on many factors, such as your creditworthiness (for example, credit score and credit history) and the length of your loan (for example, rates for 36 month loans are generally lower than rates for 72 month loans).Your maximum loan amount may vary depending on your loan purpose, income and creditworthiness. Your verifiable income must support your ability to repay your loan. Marcus by Goldman Sachs is a brand of Goldman Sachs Bank USA and all loans are issued by Goldman Sachs Bank USA, Salt Lake City Branch. Applications are subject to additional terms and conditions. For New York residents, rates range from 6.99% to 24.99% APR.

Marcus by Goldman Sachs offers a no-fee personal loan — that means all you’ll pay is your loan principal and interest, even if you pay late or miss a payment. Rates range from 6.99% to 28.99% APR and terms from 36 to 72 months, and you can borrow up to $40,000. If your credit is lower or you choose a longer term, you will generally pay a higher rate. If working with a traditional bank appeals to you, this may be a good alternative to Santander.

SoFi

SoFi
APR

5.99%
To
20.01%

Credit Req.

680

Minimum Credit Score

Terms

24 to 84

months

Origination Fee

No origination fee

SEE OFFERS Secured

on LendingTree’s secure website

Advertiser Disclosure

SoFi offers some of the best rates and terms on the market. ... Read More


Fixed rates from 5.99% APR to 20.01% APR (with AutoPay). Variable rates from 6.49% APR to 14.70% APR (with AutoPay). SoFi rate ranges are current as of November 15, 2019 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 6.49% APR assumes current 1-month LIBOR rate of 1.81% plus 4.93% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

All rates, terms, and figures are subject to change by the lender without notice. For the most up-to-date information, visit the lender's website directly. To check the rates and terms you qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull.

See Consumer Licenses.

SoFi Personal Loans are not available to residents of MS. Minimum loan requirements might be higher than $5,000 in specific states due to legal requirements. Fixed and variable-rate caps may be lower in some states due to legal requirements and may impact your eligibility to qualify for a SoFi loan.

If you lose your job through no fault of your own, you may apply for Unemployment Protection. SoFi will suspend your monthly SoFi loan payments and provide job placement assistance during your forbearance period. Interest will continue to accrue and will be added to your principal balance at the end of each forbearance period, to the extent permitted by applicable law. Benefits are offered in three month increments, and capped at 12 months, in aggregate, over the life of the loan. To be eligible for this assistance you must provide proof that you have applied for and are eligible for unemployment compensation, and you must actively work with our Career Advisory Group to look for new employment. If the loan is co-signed the unemployment protection applies where both the borrower and cosigner lose their job and meet conditions.

Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)

SoFi has lower rates, longer terms, and higher loan amounts than many other lenders, and it doesn’t charge any fees. APRs range from 5.99% to 20.01%, and terms are set at 24 to 84 months for loans of $5,000 to $100,000. Like many lenders, SoFi offers the best rates to borrowers who sign up for automatic payments. SoFi will only do a soft pull when you check your rates with its online form, and you’ll never encounter origination fees or prepayment penalties. Another advantage to borrowing from SoFi: if you lose your job and apply for its unemployment protection program, SoFi will suspend your payments without penalty and provide job placement assistance.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Emily Long
Emily Long |

Emily Long is a writer at MagnifyMoney. You can email Emily here

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Pay Down My Debt

6 Ways to Manage Your Debt Like a Pro

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

paying off debt
iStock

So, you have some debt to pay off. The first step to tackling your outstanding bills is to gather all the information — how much you owe, to whom, and what you’re currently paying.

“Get real, find out how much debt you really owe and what the terms are,” said Sarah L. Carlson, a certified financial planner and founder of Fulcrum Financial Group in Spokane, Wash.

From there, Carlson continued, the game plan is to systematically pay down your balances. She recommends setting up automatic debits from your checking account or rerouting a portion of your paycheck so you don’t have to think about it.

But how do you allot your payments if you have multiple outstanding balances? There are a number of options for tackling debt — read on to find out which one fits your specific needs.

6 strategies for tackling your debt

Regardless of which debt-repayment method you use, you’ll want to make at least the minimum payment on every account. But how you divvy up any additional funds beyond that will depend on the strategy you choose.

StrategyHow It WorksWho It’s Best For
Debt snowballPay down your smallest debt firstThose who need fast and frequent wins to stay motivated
Debt avalanchePay off your debt with the highest interest rate firstThose who have extra income and who are intrinsically motivated
Debt snowflakeMake small payments on all of your outstanding bills as often as you canThose who struggle to budget for payments
Debt consolidation Pay off your debt using a loan or balance transfer cardThose who qualify for reasonable rates and who are paying a lot in interest and fees
Lump-sum paymentsSave up to make a single large payment on your debtThose who have lower interest debt (like a mortgage)
HybridCombine methods based on your individual prioritiesThose whose needs don’t fit neatly into a single strategy

Debt Snowball

With the debt snowball method, you prioritize paying off your debt with the smallest balance first.

This means you’ll make the minimum monthly payment on all of your accounts and then put any extra funds toward your smallest debt. Once that’s paid off, you’ll move on to your next-smallest, and continue on until you eliminate them all.

The debt snowball likely won’t save you any money — since some high-interest debt may be lower on your priority list — but it does help you stay motivated, as you’ll experience small wins more frequently. In fact, according to a study from the Kellogg School of Management, those who use the debt snowball method are more likely to pay off all of their debt than those who opt for an alternate strategy.

Another perk of the debt snowball: You may have more cash on hand as you pay off each debt and eliminate those monthly payments. You can then save for emergencies or reinvest those dollars into paying off your remaining debt more quickly.

Pros

  • You get a quick win to kickstart your commitment
  • It builds discipline for paying off debt
  • You might free up more cash quickly

Cons

  • It may cost you more in interest over time
  • It may take you longer to pay off all your debt
  • You may be tempted to spend the extra cash

Debt Avalanche

The debt avalanche is similar to the debt snowball, but instead of tackling your smallest debt first, you focus on the account with the highest interest rate. This strategy is more likely to save you money over time and might help you become debt-free faster.

If you are motivated by what you’ll save in the long term or have extra income to put toward your bills, the debt avalanche may work best for you.

That said, this method can sometimes be discouraging. Depending on your situation, it could take longer (months or even years) to pay off a single high-interest balance, which means you won’t see much progress at first.

If you decide to go with the debt avalanche but need some motivation to stick with it, figure out exactly how long it will take you to be debt-free. You can use our debt snowball versus debt avalanche calculator to compare how long each strategy would take to complete.

Pros

  • You save on interest
  • You might pay off your total debt more quickly

Cons

  • You don’t get the emotional benefit from quick wins
  • It’s easier to get discouraged

Debt Snowflake

The debt snowflake isn’t quite as methodical as other approaches to debt repayment. With this strategy, you make smaller payments more often — ideally to cover at least the minimum payment on all accounts every month.

This means that you don’t prioritize any one account over another, and you don’t make a lump-sum payment toward each bill once a month. Instead, you pay $2 or $10 or $50 when you can until you cover the minimum due. If you do have additional cash in a given month, you can make a larger payment on a single debt.

If you struggle to budget for monthly payments, the debt snowflake method may help you chip away at your debt at a more manageable pace.

Pros

  • You don’t have to budget for big payments

Cons

  • This method can be difficult to keep track of and stay committed to
  • You may get hit with fees if you pay less than the minimum

Debt consolidation

Debt consolidation involves taking out a new loan or applying for a balance transfer credit card to pay all of your outstanding debt. Instead of chipping away at your debts individually, you’ll make a single monthly payment on your new loan or card.

For this method to be most effective, your new loan or balance transfer card should have a lower interest rate than the combined average of your current accounts, so that you’ll save money over time.



Compare Debt Consolidation loans

Debt consolidation may also be a smart choice if your outstanding debts are racking up finance charges and fees, or if you have too many payments to keep track of. Because you’re dealing with a single creditor rather than a half dozen, you may be able to stay more organized and make on-time payments so you don’t incur fees or take a hit to your credit.

Personal loans, balance transfer credit cards, home equity loans and home equity lines of credit are all options for debt consolidation.

Use our debt consolidation loans page to find and compare loan offers to consolidate your debt.  Keep in mind that you aren’t guaranteed offers or preferred interest rates when you use this page.

Pros

  • You may save on interest and fees
  • You may get a lower — or more predictable — monthly payment
  • You only have to make one payment

Cons

  • Some loans and cards have origination and transfer fees, respectively
  • Balance transfer cards may charge deferred interest
  • You may be in debt longer (if you take out a longer-term loan)

Lump-sum payments

If your primary debt is your mortgage, you may benefit from the emotional boost of lump-sum payments.

As Carlson explains, clients who want to pay off their lower-interest, long-term debts — like their home loans — more quickly can save up a large sum and make a single payment to put a big dent in what they owe.

“Rather than putting aside an extra hundred dollars a month, they save up $10,000 to whack off the debt because that is more satisfying and makes more progress emotionally,” she said.

This strategy likely works best if you are able to set aside more than your monthly payment without compromising the rest of your budget or debt payments. Carlson also cautions that for credit cards and other high-interest debt, you’re better off chipping away at your balances right now.

Pros

  • You’ll get an emotional boost
  • It can help you pay down your debt faster

Cons

  • You’ll need cash to set aside
  • It can cost you money on interest, especially with high-interest debt

Hybrid

If none of these methods are quite right for your situation, you may prefer to combine them or start with one strategy and then adjust as you pay down your debt.

For example, a balance transfer credit card with a 0% APR introductory offer may be the best way to consolidate your high-interest credit card debt — after which, you tackle your remaining bills using the debt snowball method. Or you start by paying off one low-interest debt with a small balance so feel like you’re making progress and then switch to the debt avalanche.

You can also be flexible based on your unique needs. Maybe your financial situation changes. One account may require immediate attention, or perhaps you have a strong emotional attachment to paying off another more quickly.

Pros

  • You can customize your approach

Cons

  • It may overcomplicate your repayment plan

The bottom line

Which debt repayment strategy is right for you will depend on your specific financial situation and your preferences. If seeing regular progress helps you stay committed to the end goal, you’ll likely need a different approach than someone who is motivated by overall savings.

“It really is about behavior and tying emotions to it, I believe,” Carlson said.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Emily Long
Emily Long |

Emily Long is a writer at MagnifyMoney. You can email Emily here

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Personal Loans

Using a Personal Loan to Pay Off Taxes

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

paying taxes
iStock

So you have a big tax bill to pay this April. Maybe you had too little withheld from your paychecks throughout the year or made more money as an independent contractor than you anticipated. Regardless of your circumstances, that outstanding debt can feel overwhelming — especially if you weren’t expecting it. Some borrowers may look into personal loans — generally used to consolidate debt, pay for home repairs or cover other big, planned-for expenses — as a way to pay back the IRS. But before you commit, learn more about whether these loans are the right choice for paying taxes.

Should you take out a personal loan to pay taxes?

The short answer: probably not.

“I can’t think of a time when it would be appropriate to take out a personal loan to pay income taxes,” Adam Funk, a CFP at Savings Coach in Troy, Mich., told MagnifyMoney.

Financial experts agree that, in general, personal loans shouldn’t be the go-to solution for unpaid taxes. One reason? It may cost more to take out a personal loan than to work directly with the IRS via one of their payment, installment or compromise plans. Interest rates for most personal loans range from around 6% to nearly 36% — and you’ll only qualify for the lowest rates if you have excellent credit.

By comparison, interest rates on outstanding taxes are the same for all borrowers and lower than most personal loans. The IRS updates interest rates on a quarterly basis. For underpayments, the rate is equal to the federal short-term rate plus 3 percentage points. As of Jan. 1, 2019, that rate is 6%.

Another benefit of working with the IRS, Funk told MagnifyMoney, is that you have more leverage to negotiate — and even have some or all of your debt forgiven — than you do once you pay off your bill and transfer the balance to a third-party lender.

In addition to interest, unpaid taxes will also incur monthly penalties — even if you have an agreement with the IRS. The IRS does note that paying via debit, credit or third-party loan may be less expensive than accruing these penalties on your outstanding bill, so you may want to explore all your options.

But before you use one of these alternatives, determine how much you’ll owe if you fail to pay off a credit card or loan balance in a timely manner. If your interest rate is high or you can’t tackle the total, you may be better off working directly with the IRS. Of course, simply failing to pay is the most expensive option.

Where to find a personal loan (if you need one)

If you do need to take out a personal loan, check with your bank first. A lender with whom you already have a relationship may be more flexible and open to working with you, especially if you have less-than-stellar credit. A local credit union may also be a good place to start — while you generally have to be a member to access personal loans and other financial products, credit unions often have lower interest rates and less strict qualification requirements for loans than traditional banks.

Online lenders may also have lower rates on personal loans than brick-and-mortar banks. With minimal overhead costs, these lenders are able to pass on savings to customers — though the best rates are reserved for borrowers with better credit.

Regardless of which type of lender you choose, make sure you shop around for the best rate. Start your research with MagnifyMoney’s personal loan marketplace, where you’ll find information about rates, terms, fees and requirements from a variety of lenders. You can also check your rates and offers directly — and see which lenders require a hard pull on your credit upfront.

LendingTree, which owns MagnifyMoney, also has a personal loan tool that may match you with lenders and loan offers. You do have to enter some personal information, including your address, employment status, and estimated income and credit score, before you receive any offers. Keep in mind: There’s no guarantee of offers using this tool.

LendingTree
APR

As low as 3.99%

Credit Req.

Minimum 500 FICO®

Terms

24 to 60

months

Origination Fee

Varies

SEE OFFERS Secured

on LendingTree’s secure website

LendingTree is our parent company

Advertiser Disclosure

LendingTree is our parent company. LendingTree is unique in that you may be able to compare up to five personal loan offers within minutes. Everything is done online and you may be pre-qualified by lenders without impacting your credit score. LendingTree is not a lender.


A Personal Loan can offer funds relatively quickly once you qualify you could have your funds within a few days to a week. A loan can be fixed for a term and rate or variable with fluctuating amount due and rate assessed, be sure to speak with your loan officer about the actual term and rate you may qualify for based on your credit history and ability to repay the loan. A personal loan can assist in paying off high-interest rate balances with one fixed term payment, so it is important that you try to obtain a fixed term and rate if your goal is to reduce your debt. Some lenders may require that you have an account with them already and for a prescribed period of time in order to qualify for better rates on their personal loan products. Lenders may charge an origination fee generally around 1% of the amount sought. Be sure to ask about all fees, costs and terms associated with each loan product. Loan amounts of $1,000 up to $50,000 are available through participating lenders; however, your state, credit history, credit score, personal financial situation, and lender underwriting criteria can impact the amount, fees, terms and rates offered. Ask your loan officer for details.

As of 17-May-19, LendingTree Personal Loan consumers were seeing match rates as low as 3.99% (3.99% APR) on a $10,000 loan amount for a term of three (3) years. Rates and APRs were based on a self-identified credit score of 700 or higher, zero down payment, origination fees of $0 to $100 (depending on loan amount and term selected).

Can’t afford your taxes? Consider these 4 alternatives

If you’re faced with a huge tax bill that you can’t afford outright, you do have options, including a number of payment plans and agreements you can negotiate directly with the IRS. Your specific tax situation will determine which alternative you qualify for.

1. Pay what you can, even if you request a filing extension

Tax returns and payments are generally due on April 15 (unless April 15 falls on a weekend or observed holiday). You can request a six-month filing extension directly with the IRS, which will push the deadline for your return to mid-October.

However, this extension does not apply to payments. If you don’t pay your estimated tax bill in April, you’ll owe penalties and interest on your balance. The IRS recommends paying what you can by the deadline to minimize these additional charges — from there, you can make a plan to pay the rest.

2. Apply for an installment agreement

If you can pay off your balance in 120 days or less, you can apply for a short-term payment plan. There’s no additional setup fee, but you will be responsible for any interests and penalties that accrue in addition to your outstanding taxes.

The IRS also offers a long-term payment plan, also called an installment agreement, which allows you to pay over 120 days or more. If you allow automatic withdrawals from your checking account, you’ll pay a fee of $31 for an online application or $107 to apply in person, by mail or over the phone. For other methods of payment (debit, credit, check or money order), the setup fees jump to $149 and $225, respectively. Interest and penalties apply.

3. Request an “Offer in Compromise”

If you can’t pay your taxes in full or via an installment agreement, you can apply for an Offer in Compromise. The IRS will look at your financial situation and may agree to settle your debt for less than what you owe. You may be eligible if your tax debt is inaccurate, you have insufficient assets to cover your bill or paying would cause economic hardship.

4. Request a collections delay

If paying any part of your tax bill would prevent you from meeting your basic needs, you can request that the IRS delay collections of your outstanding debt. You will have to provide information about your financial circumstances. Keep in mind: Delaying collections does not exempt you from your meeting your tax obligation, including interest and penalties. These will still accrue until you pay your full bill, and the IRS may still file a tax lien notice, which lets creditors know about your debt.

What happens if you don’t pay your tax bill

If you don’t pay your tax bill by the filing deadline in April — and don’t take any additional action — you’ll likely get hit with interest on your outstanding balance and a monthly fee for late payments. The late payment penalty is generally 0.5% of your unpaid taxes per month and can add up to 25% of what you owe.

There’s also a penalty for not filing your return. For 2016 tax returns, the minimum penalty for filing 60 days or more after the deadline was the lesser of $205 or 100% of the tax owed. According to the IRS, this penalty can be as much as 5% of your unpaid bill each month, up to a maximum of 25%.

If you don’t file or pay, the IRS will levy a combined penalty of up to 5% per month. There are exceptions to late payment penalties, however: If you’ve requested a filing extension and have paid 90% of your outstanding balance, you’ll only owe interest until your bill is paid off. Similarly, the IRS may waive penalties if taxpayers can show reasonable cause for failing to file or pay on time.

The IRS will send you at least two bills for outstanding taxes. If you don’t pay after your final bill, the agency will begin collections actions. The IRS can apply your unpaid balance to future refunds or seize your property — including everything from wages and retirement savings to your home — to cover your tax debt.

The bottom line: File your tax return and pay your balance by the due date. If you can’t afford to pay in full, at least pay what you can and actively explore options to minimize fees and penalties.

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Emily Long
Emily Long |

Emily Long is a writer at MagnifyMoney. You can email Emily here

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