No two people are in the same financial situation. What works for one person, may not work for you. It’s important to research your options (or meet with a Financial Advisor). Opening a personal loan is a commitment, just like any other loan. Here are some tips and advice to help you decide if it’s right for you.
What are the benefits of a Personal Loan? Personal loans are easy and flexible. It’s a specific amount of money that you borrow, for a set term, at a fixed rate. You know your payment amount and how many payments need to be made. And you can use it for nearly anything. Alltru’s Personal Loans currently offer a low rate of 8.20% APR*.
What are Personal Loans used for? Personal loans are more common than you may think. Here are the top three reasons people open personals loans:
1. Debt Consolidation. The average U.S. household that has debt, has $133,568. Most of those households have multiple forms of debt (credit card, auto loan, student loan, etc.). Instead of making monthly payments for each form of debt, take out one personal loan to pay off the other debts. That way, you only have to make one payment each month. This works best when the personal loan has a low-interest rate (like Alltru’s!).
2. Dream Vacations. We’re not just talking about a weekend road trip. We’re talking about once-in-a-lifetime getaways. Dream vacations are expensive, and if you put that cost on your credit card, it could drown you in debt (the rewards points aren’t worth the debt). Instead, you can take out a personal loan, see the world, and then make affordable monthly payments at a much lower interest rate.
3. Medical Expenses. Medical bills (ongoing or unexpected) are typically expensive. If you can’t comfortably pay for it right away, a personal loan may be your best option.
While those are the top three reasons, personal loans are also popular for moving expenses, weddings, large purchases, and more.
The common alternative is credit cards. The most common alternative to a personal loan is a credit card. Credit cards are great for small purchases and earning rewards points, but they have to be used wisely. If you can’t pay off your balance right away, it’s risky. Why? Because the average credit card rate is extremely high. When you get buried in that kind of debt, it’s hard to get out. If you have a large purchase coming soon or debt that can be consolidated, a personal loan is a better option than a credit card.
So, is a Personal Loan right for you? If you need to borrow money, a personal loan could likely help you. It can be used for nearly anything, it has a low, fixed rate, and it’s a more affordable alternative to a credit card. If you’re still not sure whether a loan is the right option for you, reach out to us. Our team is ready to look at your financial situation and recommend the best option for you.
Until next time,
*APR=Annual Percentage Rate. Rates effective 5/11/21. Rates are subject to change. Personal Loans rates and terms up to 60 months available. Sign up for automatic payments and receive a 0.25% rate discount.