![]() Our Personal Line of Credit is a revolving credit line, similar to a credit card, that gives you immediate access to extra cash when needed, up to $35,000. Open a Century Federal Personal Line of Credit and have funds available when you need it most. Thinking through factors like wants and needs can be helpful when considering if a personal loan is the right choice.Personal Line of Credit / Overdraft Protection Is it a need or a want? While emergencies happen, sometimes it’s better to save up and use your own funds to pay for special purchases. This can range from hundreds to thousands of dollars, depending on the loan and bank. In addition to paying back what you borrow, you can expect to pay an additional amount. What will I pay in all? Like other loans, personal loans usually charge interest rates and fees. It can be a struggle if you’re scrambling every time an installment is due. Here are a few questions to ask yourself when you are thinking about an installment loan:Ĭan I make the payments? Look at your monthly budget to see if you can afford the amount due each month. Understanding what’s involved with a personal loan will help you avoid issues that could come up later. Understanding the details of personal loansĮven though personal loans can be helpful, it’s important to consider a few things before taking out a personal loan. ![]() And since his loan has an interest rate of just 8%, this lowers the amount he’ll pay overall on the debt. Instead of paying hundreds of dollars on interest, he can save by putting the amounts together in a personal loan to focus on paying off the lump sum of $20,000. Jack’s credit cards have high interest rates, ranging from 10% to 20% on the balances. Jack researches his options and finds out he can get a $20,000 personal loan to pay off his debt. That’s $20,000 of debt that needs to be paid off. He now has balances of $5,000 on two cards, and one card with a balance of $10,000. To pay for supplies, he used his credit cards. Jack had very little savings when he started his food truck business. Using a personal loan to consolidate debt By taking out a personal loan, Sue can be better able to handle this unexpected expense without it being a huge financial blow.Ģ. Since she doesn't need collateral for this type of loan, Sue feels comfortable taking out a loan for $5,000 with an 8% interest rate. After researching how to apply for a personal loan, Sue learns she can take one out through a bank or online lender. ![]() She decides to see if a personal loan might be the solution. While her daughter’s feeling much better, the incident left Sue with a few extra medical bills she wasn’t expecting.įor this reason, Sue is looking for help to get the medical bills paid. Using a personal loan to get back on track To get a deeper dive into how installment loans work, consider these two scenarios.ġ. Instead of paying off several debts with high interest rates, you can work toward paying off one personal loan to pay less overall. If you have credit card debt on a few different cards that have a high interest rate, you could get an installment loan to pay off the credit card debt. You might also be able to get a lower interest rate if you consolidate debt with a personal loan. If you have several different debts and find it hard to keep track of them, combining them into a personal loan can make it easier to focus on sending out just one payment. This is the idea of putting all your debts together. ![]() Taking out a personal loan can also be a way to consolidate debt.
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