What Are The Advantages and Disadvantages of Unsecured Loans

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There comes a time in everyone’s life when they need some type of loan. These often tend to be stressful times because it usually means that you need money quickly to pay for some unexpected expense. One of the best ways to help eliminate stress during those unexpected times is to understand the options available to you. If you are already aware of the options, it makes those times easier for you. When you have more information you are in a better place to make the best decision for you at the time you need it.

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There are a few facts you should understand about personal loans including the advantages and disadvantages of unsecured loans. Continue reading to find out all the information you need to make the best decisions for you.

What Is A Personal Loan?

A personal loan is when a lender allows you to borrow money. When you borrow money from a lender, you are making a promise to repay the money. You repay by making regular payments each month of a set amount. The repayment length is anywhere from three to five months. The lender can be anyone from a traditional bank, a credit union, or even a family member. The lender charges you a fee for allowing you to borrow the money. The fee is called interest. an the lender sets the interest amount based on your credit score. The higher your credit score means the lower your interest rate may be. A personal loan can be used for any purpose you wish.

When you are interested in a personal loan, it is best that you do some loan shopping to find the lender with the best interest rate. There are many lenders available to provide you with a loan so you do not have to go with the first offer you find. There are many advantages and disadvantages of unsecured loans and you should be aware of all of them before you obtain a personal loan.

What Is The Difference Between A Secured And Unsecured Loan?

I started this article by telling you how important it is to have as much information as you can about personal loans. One of the factors to understand is the advantages and disadvantages of unsecured loans, but you should also understand the differences between a secured and unsecured loan.

A secured loan is one that has collateral attached to it. Collateral is some type of asset that you own, such as a house or a car. It can also be some other item that has significant value, such as art or jewelry. A lender accepts your collateral to prompt you to pay back the loan on time. If you do not pay back the loan, the lender takes your collateral in place of your loan. In the case of a mortgage, you are offering your house as collateral and the bank can foreclose on your home. Once you repay the mortgage, the house becomes yours free and clear.

An unsecured loan is a loan that has no collateral as backing for the loan. The only thing that provides security for the lender is your credit worthiness, which is usually determined by your credit score and credit history. The interest rate for your loan is heavily based on your credit score. You can only be approved for some personal loans if you have a high credit score. A large percent of personal loans are unsecured loans. You can shop for unsecured personal loans online. You should do a lot of research when you want a loan, so you know what options are available to you.

Advantages of an Unsecured Loan

If you have not figured out by now, there are many advantages and disadvantages of unsecured loans. Before you visit loans shop online, you should understand all of the information, the good and the bad, about unsecured loans. You should not take on more debt without really thinking it through. You should keep in mind that this money is a loan and must be repaid. The lender is not just giving you money.

There are some benefits to consider about an unsecured loan when making the final determination about taking a personal loan. Unsecured loans are available to just about anyone, but you must qualify for the loan. Your credit score is the biggest piece of information that can qualify you. You do not have  to worry about providing collateral for an unsecured loan because it is not needed. No type of collateral is accepted for an unsecured loan. You are able to get your money quickly, often as fast as a few days, because there is no need to appraise the collateral. An application for an unsecured loan can be completed in the same day.

Unsecured loans are great for those who do not have anything to offer as collateral. They are also good for those that may not have the best credit. You can also find unsecured loans online which makes researching them very easy. So you can fill out the application and upload documents all in the same online session. You can often be approved in the same day. Money is deposited in your bank account usually on the next business day. You are usually able to pay off your loan early, if you wanted, without any penalties.

Disadvantages of An Unsecured Loan

I mentioned that you have to be aware of the good and bad aspects of an unsecured loan, so now I am going to talk about the bad stuff. What kind of article about the advantages and disadvantages of unsecured loans if I failed to mention the disadvantages? People do not often like to talk about the bad stuff, but it is just as important to know when trying to make a decision like this.

One of the biggest negatives to unsecured loans is that many of them come with high interest rates. Unsecured loans have higher interest rates than secured loans. The lower your credit score is equals a higher interest rate. Lenders take on greater risk when they offer you unsecured loans. The lower your credit score means that the lender takes on even more risk. They are less willing to take on that risk when your credit score is low.

Unsecured loans come in limited amounts, so you may not be able to get an unsecured loan in the amount you need or want. A lender may only be willing to lend you a certain amount and it may not be enough for your needs. They typically do not have any flexibility. You probably will not be able to change the terms of your loan once you have agreed to the loan terms. Also, you may not be able to get a better rate on your existing loan. You would have to obtain a different loan for a better rate and pay off the first loan. An unsecured loan is still a loan, which means you are taking on more debt. Ultimately, that could negatively impact your credit score.

Are There Different Kinds Of Unsecured Loans?

In addition to many advantages and disadvantages of unsecured loans, you should also know about the various kinds of unsecured loans that are available to you.

There are personal lines of credit, which are loans that are open-ended. You can withdraw the funds you need as you need them over a specific period of time. Also, you can access the loans through a bank transfer or with a check. You are given a certain amount that you can borrow. They range anywhere from $1,000 up to $100,000. Interest only accrues when you withdraw the money and it only accrues on the amount of money that you withdraw. It only accrues until you pay back the money.

There are debt consolidation loans that can be unsecured as long as you have good credit. This type of loan allows you to combine all of your debts into one. You only have one payment instead of multiple different payments across many bills. And you may be able to get a lower interest rate with a debt consolidation loan than the high interest you pay on your other bills.

You can find loans to finance your wedding or a vacation. The interest rates may be higher on these types of loans, but they help you pay for something specific. You are able to reduce your stress by paying the money upfront for a trip or wedding and then make regular monthly payments.

You may also be able to get a loan to pay for a specific medical expense or need. Sometimes, these loans are harder to get and may have a higher interest rate. You may be able to get these loans from a medical provider or someone who only provides loans for medical purposes.

Are There Things I Should Avoid When It Comes To Unsecured Loans?

There are a few types of loans that you may want to avoid when it comes to personal loans. While there are advantages and disadvantages of unsecured loans, some loans have more disadvantages.

There are short term cash loans that are geared towards those who have poor credit scores. Just about anyone, with any type of credit, can be approved for these types of loans. They have repayment periods that are incredibly small. You have to be sure that you can repay these loans. These types of loans can put you in a bad financial position. You usually have to pay back the money in two weeks or less. If you do not pay back the money timely, you have to pay high fees or additional charges. You may need to take out another loan to cover the first one. That puts you in a dangerous cycle. These loans have sky-high interest rates.

There are also payday loans. These are also geared towards those that do not have the best credit. These loans are for smalls amounts. You have to repay them when you get your next paycheck. You have to provide a paycheck as proof of how much you earn with each paycheck. This also indicates to the lender how much they are willing to allow you to borrow. They do not let you borrow more than you make per paycheck. These loans also have high interest rates.

These types of loans often make things worse for you. Both of these types of loans are limited to small amounts. The low amounts limit how much you borrow. They may not cover all the debts you owe. You may have to take out many loans of this type. Every loan you have puts you further into debt. This may put you into a situation you cannot get out of.

What Should I Look For In An Unsecured Loan?

There some other things that you should look for when you are deciding about unsecured loans. In addition to all the advantages and disadvantages of unsecured loans, you want to understand the type of loan to which you want to apply. You should also know what the eligibility requirements are for a loan you are interested in. And you should know if the loan has an application fee or penalties for paying off the loan early.

You should make sure you have a clear understanding of the annual percentage rate (APR). This is the interest rate in addition to the origination fee that you are charged for borrowing the money. The better credit score that you have means the better interest rate you receive. The lender may be offering you a promotional rate, so you should understand how long the promotional period lasts. You should also understand what happens when the promotional period ends and if your interest rate increases. The interest rate may get so high that you may no longer be able to afford to repay the loan. The length of time you have to repay the loan can vary from one, three, or five years. The longer you have to repay the loan usually means that your interest rate is going to be higher.

Most loans have fees associated with them, so it is important for you to understand what fees are associated with your loan. You may have fees because you made a late payment, processing fees, and early payoff. There may be other perks or bonuses that can come along with your loan. You should be aware of all of those before you sign your loan agreement.

What Do I Need To Apply For An Unsecured Loan?

When you apply for a loan, there are a number of documents that you may have to provide to a lender. It is helpful if you have all of these documents available before you apply for the loan. This way, you already have them and you will not have to look for them. The first step you have to take is you need to fill out the application for the loan. No matter what type of loan you want and from which lender, you always have an application.

You have to provide proof of your identity. The lender needs to know that you are who you claim to be. Usually a valid photo identification card, such as a driver’s license, state ID, or military ID, should be sufficient. You may also need to provide proof of income, such as paystubs. You may also need to provide bank statements to show that you have the money to repay the loan. A lender may ask you to provide other documents to them. No matter what the lender asks you to provide, it is important that you do so quickly. If you do not provide them what they need within a certain period of time, it may a reason for them to deny your loan.

While you are going through the application process for a personal loan, when it seems that the lender is being difficult with their requests, keep in mind that this is another on the list of advantages and disadvantages of unsecured loans.

Unsecured Loans in California As Soon As Tomorrow

Do My Savings Impact An Unsecured Loan?

There are many advantages and disadvantages of unsecured loans as I have described throughout this article. It is important to have savings. However, those savings most likely will not help you be approved for an unsecured loan. When you create a budget, it gives you a clear idea of how much money you can save each month. It also gives you an idea of where you are spending all of your money each month. This also shows you where you can save money. You can cut out spending by reducing the number of times you eat out per month. It is a great way to reduce spending and increase your savings.

While there are many advantages and disadvantages of unsecured loans, you should still focus on your savings while determining if a personal loan is right for you. If you are able to cut your expenses enough, you may decide that you no longer need a loan.

Conclusion

This article gives you a lot of advantages and disadvantages of unsecured loans, but you still must make a smart decision when it comes to unsecured loans. You have to decide if you can afford to repay the loan. If you cannot, it is not a good idea for you to take on a personal loan. The best way for you to decide this is to create a budget for yourself to see how much money you can afford to repay each month. Even though there are many advantages and disadvantages of unsecured loans, you should not rush into this decision.

Are Personal Loans Considered Taxable Income?

There comes a time in all of our lives when we need extra money fast. While it may be easy to get a consumer loan, you probably have some questions. Since you get money when a lender approves you for a loan, you may wonder are personal loans considered taxable. The short answer is no, a personal loan is not taxable income and you do not have to pay income taxes on that loan. Continue reading to find out more.

What Are Taxes?

There are several types of taxes. But let’s start with the type that concerns us. What are income taxes? Income taxes are taken out of every one of your paychecks. Your employer takes the money out of your check before you ever see your money. This makes it easy for you so that you do not spend the money before you pay your taxes. If you are self-employed, you are responsible for paying your own taxes. Income taxes varied depending on how much income you make and typically the percent of taxes you have to pay increases with how much income you have. There are taxes other than income tax that you have to pay.

Most states, with the exception of Delaware, have sales tax. This means that you pay a tax on items you buy. The amount of tax and the items that are taxable vary from state to state. You pay this tax at the time of purchase.

If you earn interest on money in a savings account, that is considered income, so you pay taxes on the interest. You have to claim the interest on your annual tax return.

If you own a house or other property, you have to pay property tax on it. This is usually paid in your monthly mortgage payment. That money is held in an escrow account until the annual payment is due. Or you could opt to pay this out of pocket annually on your own.

At the time you purchase a car, you must pay a special tax on the vehicle. You can pay this upfront, or have it rolled into your monthly payment amount.

What Are Personal Loans?

A personal loan has many names, such as fast loans and unsecured loans. You can even obtain unsecured personal loans online. No matter what you call it, the basic premise of a personal loan is a lender lets you borrow money. The lender can be a bank, credit union, or even a family member. They allow you to borrow a certain amount of money with your promise to pay them back with a regular monthly payment. The lender charges interest on the money you borrow as a fee for letting you borrow the money.

Typically the repayment period is anywhere from three to five years. For a typical personal loan, the monthly payment remains the same each month. Since you are receiving money, some often wonder are personal loans considered taxable income? Since you are repaying the full amount of the loan (and then some), personal loans are not considered taxable income and you do not have to pay any type of taxes on the money you receive.

Do Personal Loans affect your Tax Return?

What Is Considered Income?

Taxable income is any money that you receive from earned or unearned income. Earned income is money that you receive for work or other services provided. This includes wages, fees, and tips.

Unearned income is a little trickier and not all unearned income is taxable. Types of unearned income that could be taxable are lottery winnings, bonuses, profits earned by selling assets, and stock dividends, just to name a few.

Keep in mind that taxes are paid on your gross income. Gross income is the amount of money you earn before any money is taken out. Net income is the amount of money that goes into your bank account after all deductions and withholdings. You may still be wondering if personal loans considered taxable income, and they are not.

Do I Have To Pay Income Taxes On A Personal Loan?

For the most part, you do not have to pay income taxes on personal loans. There is one exception when a personal loan is taxable. The typical way a personal loan works is you borrow the money. Then you repay the money on time with interest. This scenario does not consider a personal loan to be taxable. If you the personal loan is a cancellation of debt, or the lender forgives the loan, this means you do not pay back the money. In this instance, the personal loan you received is considered income and you have to pay income taxes on the amount you borrowed. If you were wondering are personal loans considered taxable, this is one of those situations when they are.

What Happens If I Do Not Pay My Income Taxes?

You should be clear on one thing, the Internal Revenue Service (IRS) will get their money. You should make every effort to pay your taxes. That said, IRS really wants to work with you to ensure you pay your taxes. It feels like they are working against you, but they really are not. It is key to understand what is considered income and the amount on which you owe taxes. You should know if personal loans considered taxable income.

The most important thing is to file on time. IRS hits you with heavy penalties for not filing on time. If you owe money, you should pay it. If you cannot pay it all at one time, set up a payment schedule with IRS. They are willing to work with you, especially if you show intent to pay. If you do not pay, you are hit with penalties and interest charges. The interest accrues every day until you pay them back.

Can I Use A Personal Loan To Pay My Taxes?

You can use a personal loan for just about anything you want. So, yes, you can obtain a personal loan to pay your taxes. However, just because you can does not always mean you should. You still need to make sure it is the smartest decision for you. Since as long as you pay them back IRS does not think personal loans considered taxable, so you will not have to pay additional taxes. You should determine how much you will pay to the IRS in fees and interest.

You should also consider how much you can pay them per month and for how long before your debt to them is paid. Once you know those numbers, you can determine how much you would pay in interest for a personal loan. Once you know that, you can determine your monthly payment. You can compare the numbers for both and determine which one is more favorable for you. You may decide that a personal loan is a way to go. This is only true if you can afford to make the monthly payments.

Does My Credit Score Impact My Taxable Income?

No, it does not. Your credit score does not impact the amount of income taxes you pay. It is based solely on the amount of money you earn. IRS does not think personal loans considered taxable income. The IRS does not particularly care about your credit score. They are only concerned about getting their money from you. The good thing about this is the IRS does not check your credit score when they set up a payment plan with you. Your credit score does not impact the fees or interest that the IRS charges. Another point of note is that the IRS does not report anything to credit bureaus, so setting up a payment plan does not lower your credit score.

Why Does My Debt To Income Ratio Matter?

Your debt to income ratio makes a difference when it comes to matters of obtaining credit, or loans. It does not particularly impact income taxes, or how much you have to pay in income taxes. It does come into play if you are considering obtaining a loan to pay any taxes that you owe. Just as a reminder, IRS does not think personal loans considered taxable income, so you do not have to pay income taxes.

Let me give you just a little bit of information about debt to income ratio, so you understand how it is determined. Your debt to income ratio looks at how much money you owe per month versus how much you earn. It is the amount of your gross income per month that is for rent/mortgage, credit cards, and other debt. Your gross income is what you earn before taxes. Most lenders want your debt-to-income ratio to be less than 43 percent of your income.

Are Taxes Different For A Small Business?

Taxes for a small business are different from income taxes for an individual. Depending on how your business is organized determines what types of taxes you are paying. When there is more than one person in the business, it needs to be recognized as a partnership. However, to make this simple, I am going to focus on taxes for someone that is in business by himself.

In this case, you are considered a sole proprietor. The rate you pay is the same as the personal income tax rate. As with an individual, IRS does not think personal loans considered taxable income. You do, however, have the ability to make different deductions when you are a sole proprietor than when you are an individual. There are some additional forms that you must fill out when considered a sole proprietor. The Schedule C is one of those forms.

What Is The Schedule C?

While the Schedule C may seem daunting to you, it is one of the most useful tools in your arsenal as a sole proprietor. It is the front and back of one page. This is the worksheet that allows you to itemize all of your expenses and deductions associated with your business. It is basically your total income minus your expenses and that equals your profit. You should keep your receipts and track any mileage that you plan to claim at the end of the year. At the most basic level, everything you buy for your business and every training you attend may qualify as a deduction.

Can I Avoid A Personal Loan?

Even though the IRS does not think personal loans considered taxable income, they still may not be right for you. Some of you may be thinking, I really do not want to take on any more debt. Or you may not be able to afford any more payments. In those cases, avoiding a personal loan might be best for you.

Let us talk about some other options for just a few moments. You could try to save the money you need in an effort to avoid a personal loan. If you cannot pay your taxes, you can set up a payment plan with IRS so that you are paying them a regular monthly amount. This does not require you to take on any more debt. It does not require a credit check and has no impact on your credit rating. You could also borrow money from family or friends. This also will not impact your credit score and they may not charge you any interest, so you can save some money.

Do I Really Need A Budget?

Another big thing you can do to avoid a personal loan is create a budget. I already know what you are thinking. No one likes that word. People think of a budget as a bad thing. I encourage you to look at it as a positive thing. It puts you in charge. You get to decide what is most important to you and work towards those goals. It is a way to take a hard look at where your money is going and make positive changes. This is your chance to see that you are still paying for a gym membership that you never use. You can take action to cancel that membership.

You must create a list of all of your expenses. Be sure not to leave any one of them out. This way you can see how much money you are spending each month and how it compares to how much money you earn each month. You might be surprised by what you see. When you do the math, you can determine how much money you have left over each month. Keep in mind, IRS does not see personal loans considered taxable income.

 Conclusion

People always get scared when it comes to taxes. They really are not that scary. There are some key points to help make filing taxes as easy as they can be for you. Make sure you file on time and get assistance when you need it. I have already told you that the IRS does not think that personal loans considered taxable income, so you do not have to pay income taxes on them. There are many other details when it comes to taxes that may be helpful to you for saving yourself from paying a higher amount of taxes.

In addition, when you have to pay a large amount of taxes, you may want to consider a payment plan with the IRS. You could also consider taking out a personal loan to pay off the taxes. This way you do not have to deal with the IRS. Each situation is different. You should make sure that no matter which path you go down, it makes the most sense for you.

What Can I Do to Avoid A Personal Loan?

I know what you’re thinking. “Dude, are you sure you’re writing for the correct blog? I thought you guys were all about hooking people up with lenders and yay personal loans! If I avoid a personal loan, aren’t you doing everything wrong?”

I prefer to think of it in terms of helping people get themselves into a better financial situation. Sometimes a different perspective can help clarify our options. And if I slip into motivational mode a little here and there along the way, forgive me – it’s my nature and I can’t help myself.

How Can I Avoid A Personal Loan?

If you don’t owe anyone money, we’d like to help you avoid getting into unnecessary debt. If you have poor credit, we’d like to guide you through improving your credit rating so when you do need a loan, you can get one on better terms. And if you’re feeling a bit financially shaky, but you’re not sure how to wrangle things back on track, I’d like to offer encouragement and help you avoid a personal loan you might not need now so that you’re in a better position if you choose to go that route in the future.

Obviously, if you want a loan, we’ll help connect you to someone legit and let you work it out with them. (We don’t actually loan money or sell you anything ourselves; we don’t even have mugs or t-shirts).

If you’re interested in getting a personal loan, in spite of everything, you can do so here, on Loanry. We connect you with reputable credit card companies. If you enter your information, you can see whether you qualify for any of the options:


But wouldn’t it be better if you could avoid a personal loan to begin with?

Avoid A Personal Loan By Maintaining A Personal Budget

Personal loans aren’t bad. They can help consolidate debt, lower your overall interest rates, handle unexpected medical or repair bills, finance large purchases, and even help you build (or rebuild) your credit. But they’re not magical solutions, either. If you’re spending more than you make, no variety or combination of personal installment loans is going to solve that. In that situation, you don’t need another loan; you need a good budget.

Budgets don’t all look the same. My wife is very methodical about hers. She maintains a detailed spreadsheet, with formulas and everything, and only takes on debt when it serves a very specific purpose. A rough month for her is one in which she’s not able to put the usual amount into savings. At any given moment she can pull up information about any of it on any device she’s using.

I, on the other hand, find it both practical and essential to use several credit cards – regularly, but not recklessly. My income varies throughout the year, so access to revolving debt via modern plastics is a practical way for me to keep things consistent. I have a good idea of my obligations each month, and years of crushing debt and personal humiliation taught me to budget accordingly. I use legal pads and I scribble a lot.

Why am I telling you this? Because the number one way to avoid a personal loan is to budget yourself, even if there’s more than one effective way to do this. I’m not trying to guilt you out of anything beyond basic shelter and a few dry crusts of bread. I’d rather you be happy than rich. But a tangible budget in any format, hard copy or digital, forces us to acknowledge where our money is coming from and where it’s going – Adulting 101.

The Power of the “B-Word” (Budgets)

Although it’s not important that your budget looks or operates exactly like mine (or my wife’s), let’s look at a few steps towards organizing your own. First, though, a disclaimer. I don’t want to go all “safe space” hugs-and-puppies on you, but considering we’re mostly talking about numbers, it’s surprising how many “feels” can pop up – especially if you haven’t done this before.

The steps themselves aren’t complicated, but some of us find them very difficult. Money and how we spend it can be personal and emotional to discuss. It can challenge our self-worth and reveal things about ourselves we may not want to know. Some of us get defensive (I always did, back in the day), some of us get angry, and some of get depressed and don’t want to think about it at all.

I told you I was a motivator. You feel better already, don’t you?

I’m not trying to be a downer. It’s just that emotions, like most things, are easier to deal with if we acknowledge them up front. Are you worried about what some basic math might reveal if you run the numbers? I get that. I’m a big fan of denial – just ask my first wife. It’s just that denial doesn’t work.

A few of you have no idea what I’m talking about right now. To you, it’s just numbers and practical decision-making and what’s the big deal? The way to avoid a personal loan is obvious – don’t put yourself in a position where you might need one! For the rest of us, though, making a personal or household budget can be an act of messy courage. It can take nerve. Grit. Moxy. Some have even compared it to overcoming drug addiction.

Alright, let’s grab some tissue and a glass of wine and let’s get started.

Creating Your Personal (or Family) Budget

Step One: Gather Information

This might take a few hours or a full month. You’ll want pay stubs, utility bills, mortgage information, car payments, grocery store receipts, medical bills, credit card statements, ATM receipts, and anything else related to money coming in or going out.

Some experts recommend computing your own debt-to-income ratio. It’s a useful exercise, but I’m not pushing you that far yet. Right now we’re just trying to get a clear list – on paper or screen – of what’s up with our finances these days.

Why? Because many of us simply don’t realize where our money goes. We may think we don’t eat out very often, but your credit card statement says otherwise. We may think we’re careful with our cash, but this says you made a $300 withdrawal two weeks ago and you have $24 in your wallet and no idea where the rest of it went. You want to avoid a personal loan? Know your own spending. In detail. With honesty.

Please understand, I’m not telling you how to spend your money. I’m suggesting that you should be making conscious decisions about how to spend your money, not just improvising and hoping for the best. I’ve been there, remember?

The Untold Tricks to Negotiating Your Bills

Step Two: List ALL Expenses

Some monthly obligations are fairly consistent – your car payment, your house payment, etc. Others vary from month to month – utilities, groceries, gas, etc. Write them all down, with the most accurate figures you can manage.

You’ll adjust this part several times in the first few months. That’s OK; it’s part of the process. Expect some of your estimates to be off, and for there to be a few surprises. That’s one of the major reasons we’re even doing this. That doesn’t mean you’ve done it wrong; it means you’re doing it better and better as you learn.

If you determine that you make enough to cover the essentials with a little left over for the optional items on your list, you can easily avoid an unsecured personal loan online or any other sort of new debt as long as circumstances don’t change dramatically. So, yay!

Step Three: Compare Your Income To Your Expenses

If emotions haven’t kicked in yet, this is the part where they usually do.

In a perfect world, you’ll have at least 10% more income than expenses. If that’s the case, congratulations! You win at America! Skip to a post about savings accounts and planning for the future.

If your world isn’t perfect, hopefully, your income and your expenses match up pretty well. If so, feel free to skip to the money-saving ideas below to try to reach that 10% or better balance above.

For many of us, however, our expenses are apparently larger than our income. That’s not ideal, but it certainly would explain a lot. It’s not that you’ve failed or you’re doing everything wrong; you just literally don’t have enough money to do everything you’re currently doing.

Now, if things have already gotten too severe, and things are being repossessed or turned off, you have more immediate concerns than how to avoid a personal loan. Before we can talk about digging yourself out, we need to stop the proverbial bleeding and stabilize the patient – in this case, your economic life. This may require reaching out to local social services, religious organizations, or charity groups when you need help paying bills.

I’m going to assume it’s not quite that bad, however, and that you’re somehow getting by enough to keep digging yourself deeper and deeper into debt. Maybe it’s those student loans, or even worse – medical bills. Maybe you lost your job at the worst possible time, or just came through an ugly divorce. Whatever the situation, you’re in debt and the situation is unsustainable. If it doesn’t start getting better, it’s going to get much, much worse.

Either way, stay with me through Steps Four and Five. There’s always a way through. It may not be pretty or fun, and you may not avoid a personal loan of some sort along with some lifestyle adjustments, but it’s doable.

YES, for you. YES, in your situation. Why are you even arguing with me in your head like that? How rude.

Step Four: Prioritize Your List

This part tends to start easyly and quickly gets weird. Your house payment should go at or near the top, along with your car payment (if you have one). Utilities, although the electric seems a big high – is there something we can do to get that under control without making ourselves too miserable? Groceries are important, although it looks like we got $40 cash back on this one and another $60 a week later. Where did THAT money go?

https://www.cashry.com/blog/best-way-to-create-an-emergency-fund/

What’s this recurring charge on the credit card from some place I’ve never heard of? When did the cable bill go up? Why didn’t we record this check? I have the amount but no idea to whom it was written or why. Can you even listen to this many new downloads in one month? And I’m glad you’re paying for legal streaming instead of using your cousin’s log-in, but are you really likely to watch Hulu AND Netflix AND CBS Streaming AND…?

You get the idea. If we want to avoid a personal loan, we’re going to need to get a grip on some of these miscellaneous expenses. We’ll come back to this in a moment, but first, let’s finish figuring out a budget that we’re spending every month.

It’s helpful to have multiple columns. I always start with “Non-Negotiables”: house payment, car payment, any outstanding loans with fixed payment amounts each month. These will be largely the same every month for the foreseeable future. That may not make them easy to pay, but it does make them easy to anticipate.

I put utilities and credit card payments in a second column I call, quite cleverly, “Credit Cards & Utilities.” These may not seem related at first (and you don’t have to combine them for your own budget), but they’re essential to pay each month, on time, and yet their amounts vary each cycle – sometimes widely. (Side note: if your local utility companies offer one of those payment averaging plans so that the amount due each month doesn’t fluctuate quite so unpredictably, DO THAT.)

Third are things which are “Important,” but over which we have at least some control. Groceries must be bought, but meals for a week might cost $60 or $200, depending on your choices. Gasoline, clothing, anything you can influence but not do completely without.

I used to combine everything else into “Other,” but I’ve recently found it more helpful to be more specific. “Optional But Useful” includes stuff like my cell phone payment, cable, internet, etc. Technically we can live without these, but as a practical matter… well, personally I’d probably spend way more on other things if I didn’t have cable and internet. Still, I may not need it all. “Fun Stuff” is eating out, movie tickets, concerts, Amazon downloads, books and magazines, etc. Stuff we could easily survive without but makes life more fun. Finally, I have “Unpredictables.” It’s not good grammar, but it seems this column always has something in it nonetheless. It’s also rather difficult to budget for; stuff which goes in this column tends to be, um…

I probably don’t need to finish that sentence, do I?

You may find a slightly different structure works better for you. It’s your budget – organize it as you see fit. But DO organize it. And then DO move on to Step Five. Remember, we’re trying to avoid a personal loan, even if things aren’t looking as rosy as we’d hoped at this point.

Speaking of which, you might not like me as much after this next part. Please know that I still love you the same.

Step Five: Time To Make Some Difficult Decisions

Do you know why most of us have so much trouble losing weight? There are plenty of reasons, but one of the biggest is that you don’t have to eat badly all day every day to have a weight problem. You probably eat nothing at all during the eight hours you’re asleep. You may eat quite reasonably – maybe even exercise a bit – during fifteen of the sixteen hours you’re awake. The problem is that the remaining hour. Thirty minutes for fast food at lunch (“just this once because what a day!”) and another half-hour in the evening when you decide to finish off the leftovers (“no one’s going to eat them anyway if we save them”) and the diet is blown.

It’s truly not fair. Take it up with the Universe, I guess.

One great way to get your debt off your back is to use the debt snowball method. It really helps you reach your goal, but you have to stay with the methodology of paying off the lowest debt first.

Bad spending choices are the same way. It’s not that most of us are spending wildly all day, every day. It only takes a few weak moments a week to reverse whatever progress we’ve made. It’s especially bad if we convince ourselves we’re going to radically change how we spend money – we’re not merely going to avoid a personal loan, we’re going to climb out of debt and into a comfy retirement package before the next snowfall! You know what happens when we try this with diets – eagerness, enthusiasm, energy! For about five hours! Then… we slip. We fail. It’s all over. Forget it. It’s never going to work. I quit.

Or maybe that’s just me.

I hope it’s not just me. (Tell me it’s not just me?}

Avoid A Personal Loan By Cutting Expenses

Just like improving our eating habits, we’re not going to talk about revolutionary changes. If you make those sweeping fixes instantaneously, that’s great! Good for you. For the rest of us, though, I’ll conclude with ten of my favorite ways to avoid a personal loan by shifting the balance between our income and our “out-go.”

1.    Take your lunch one or eat at home a few more days a week. If you eat lunch out every day, take a sandwich twice a week. It won’t kill you. If you take the family out twice a week, cut back to once. Don’t shun everything you enjoy; just look for ways to shift the balance.

2.    Cut back on smoking, drinking, or whatever other expensive vices you may have. I’m not lecturing you on the downsides of vaping or alcohol or whatever. But as you well know, that stuff is expensive. If quitting isn’t realistic, see if you can cut back by a quarter. Maybe a third. If you like to have a glass of wine or a beer in the evening, buy it at the grocery store and have it at home – restaurants charge huge mark-ups on that stuff.

3.    Carry less cash. If you need to have a few bucks for unexpected situations, that’s fine, but try to limit the amount of spending you can’t document at the end of the week. Ask for receipts even when you stop and the convenience store for a snack and a drink. It’s your money; spend it how you like – but be willing to own it and keep track of it.

4.    Plan travel to limit wasted driving. If you have kids, you probably already do this out of the necessity of keeping everyone’s schedule straight. If your kids are older, or you’re child-free (congrats!), however, it’s easy to get casual about driving across town to get your hair cut, then home. To the post office, then home. To the store, then home. That’s fine, but it adds up in both gasoline burned and wear and tear on the car or truck.

5.    Go easy on the groceries. I understand why you buy bottled water, but it’s crazy expensive compared to tap water, even after a cheap filter from the hardware store or one of those fancy pitchers. If the store brand of whatever you’re buying tastes crummy, avoid it, but come on – is it really that different? (Half the time they’re literally the same, other than the packaging.) And for goodness sake, eat those leftovers. Better yet, make extra on purpose and freeze it for next week – that way you’re buying in quantity (cheaper) and more likely to eat at home when you’re in a hurry because all you have to do is reheat.

6.    Cancel that gym membership. Unless you’re really going – regularly. And going already, not theoretically starting next week.

7.    Use your local library and resale shops. How many times are you going to read that book? Are you sure you need to own that movie? Go check out your library – they’ll be thrilled to see you, and it’s all free. When you buy, try the used bookstore, used CD shop, etc., first. Even on Amazon you should browse used options before you decide. Once you get it home, it’s “used” anyway.

8.    Pay your bills on time. I realize this sounds like a strange one, but late fees and interest and such add up crazy quickly on most credit cards, utilities, or other commitments. It’s one thing if you simply don’t have the income to make it happen (see above), but far too often it’s more that we lose track and simply don’t keep up with what’s due and when. Defaulting on your existing loans or obligations is counterproductive and will catch up with you. Plus, it’s just wrong.

9.    Check out online rebates, coupons, prescription savers, etc. Don’t waste hours poking around for fake bargains on the internet, but major department stores and many name brands put significant coupons on their websites for stuff you were going to buy anyway.

10.    Call everyone you owe and start cutting. Don’t renew that magazine. Cut some features from your cell phone plan, cable TV, or whatever it is you do on the internet. I’m not suggesting you bail on something to which you’ve already committed, but you’d be surprised how flexible many providers get when you call to cancel or reduce your service. (This sometimes works with stuff like car insurance as well.) Do you really watch that much HBO? Need that much data on all four phones? Look over every bill, whether online or mailed to you.

Maybe your best friend keeps one streaming service and you keep the other one, then you trade off watching at each other’s house. That saves you even more because you’re not out buying overpriced beer at some sports bar before your overpriced snacks at the movie teenagers will ruin by talking the whole time anyway. That’s a TRIPLE WIN.

BONUS: If you want inexpensive fun one evening, search the internet for other ways to save money. Surely there will be a FEW idea I haven’t mentioned which would work for you. And they’re free.

Final Thoughts

If you decide it makes sense for you in spite of all this to take out a personal loan to consolidate other debts, well… it turns out we can help with that. You don’t have to loan shop alone. We’re actually experts at helping folks like you find options for unsecured personal loans online. You may feel like things are desperate right now, but trust me – it won’t help if you rush in blindly and get taken advantage of by some sketchy “fast cash” place behind the gas station or any of the many online loan scams out there. Let us help you find a lender only if you need it, but your first goal is to avoid a personal loan.

In the meantime, don’t give up. It might take a while, but you can do this. Really.

Should You Get A Personal Loan for Home Improvement Projects?

When I first bought a home, it was one of the hardest experiences of my life. It was something that I had been looking forward to for years, but it wasn’t what I expected. There was so much to fix up, and really not enough time to do it.

Home is where the heart is. It’s cliché, but it’s true. I spend the most time here. This is where my family lives, where we grow, and change and where we want to grow old. Since we also spend more time there and our needs continue to change, it’s also the place where we need the most funds for upkeep and maintenance. On the one hand, it’s my dream house, the place I can be happy and fulfilled, but it’s also the most expensive money sink.

What type of loan is best for home improvements?

I can get home improvement loans from a number of different sources. The most logical sources are via my local credit union or bank, but there are other options as well. I’ve also been looking at making my home more energy efficient, with green technology and other environmentally friendly improvements. Those great energy efficiency improvements also make sense from a cost-to-benefit point of view.

Home Equity Loans or Home Equity Lines of Credit (HELOCs are most popular):

With the home equity loan, I can borrow against the equity in my home, usually all at once. This is probably the most common home improvement that exist. That gives me cash-on-hand to work with for my home improvement projects. It’s like a credit card, since I can just borrow the amount I need and then pay it right back. It can be quick-and-easy.

Smart Money Tip!

My other important consideration is the fact that a home equity loan can be a tax deduction. On the flip side of that, though, you must be sure that you will be able to pay the loan back (with the closing costs figured in as well). Since my home is taken as collateral, there’s also the chance that the lender will foreclose on my house if I can’t make the payments, which is never a great proposition.

Credit Cards for Home Improvement:

I’ve covered previous home improvement expenses and other unexpected costs with a credit card, savings, or even borrowed funds. But home improvement is so expensive. It doesn’t take long for all the back-up credit cards and other loan options to dry up pretty quickly. It quickly becomes obvious that I need to explore other alternative funding sources as loan options.

Title I Loans:

The Title 1 Loans are available from the U.S. Department of Housing and Urban Development for home improvements and renovations. It’s an attractive option, because I am not required to have a minimum income requirement or credit card score. I can be eligible based on ownership of my house for 90 days, but also based on owning property with a land contract.

Using your 401k

Depending on the project, though, I might not have enough time to determine how to pull money out of my 401k. Then, it also takes time to fill out the form and get all the paperwork processed and approved so that I can borrow from my 401k. Of course, there’s also the substantial penalty for pulling the money out early. Even if and when you pay the money back, you’ll end up with less money in your account at the end of the exercise. All taken together, it can just be a pain to tap into funds from my 401k.

Personal Loan for Home Improvement vs. Lines of Credit/Above Options

Not every home improvement loan is the same. I’ve found that a number of options for payment and financing exist and they vary depending on when I need the money and how much equity I have in my house. It also depends on how much the project will cost, and whether I’m planning my project with a larger overall scope. The process of my home improvement loans also depends on the payment options that will work best for me. The best option for me will also depend on what form of payment that I want to use for my home improvement loan.

A home renovation loan doesn’t always need to be completed right away, but it often feels like there’s a sense of urgency. I feel like I have to home improvement loanmake the decision right away and need to get the house fixed. I need to move forward with my life and just get it done. But this is the perfect opportunity to really take a step back and reflect on what I need, what I’d like to accomplish, and what the very basic requirements are for accomplishing my goals. The best step forward is to take a breath, reflect and plan. Here are some top considerations for home renovation:

  • Make a Budget: How much money do I need? What will I need to cover? This must include the costs for materials and supplies, as well as any labor estimates for contractors that I need to bring in.
  • Keep Track of Expenses: I need to carefully track receipts and expenses. One of the biggest stressors in a home renovation project is the “creep” of vendors, materials and supplies. I need to track all the expenses, and not let job delays kill my budget.
  • Make Sure Your Paperwork is in Order: It’s not always easy to organize all my financial records, including student loans, mortgages, bank accounts, etc.

While I may not need all that paperwork for a home renovation personal loan, it’s always a good idea to determine exactly what assets and expenses I have. It would be nice if the assets miraculously multiplied, but just knowing what I have does help too.

Unsecured Loans – Personal Loan for Home Improvement

Unsecured loans are considered “personal loans.” Since it doesn’t involve any collateral, financial institutions consider these types of loans bigger risk factors. That risk factor also means that banks usually prefer to already have a relationship for bank credibility. They must trust me and feel sure that I will pay back the loan as promised. But based on that trust, they may offer me a better interest rate.

Bad credit can also be a factor. As you’ve already seen, your credit can affect your financial situation. It might be more psychological than actual. Your bad-credit perception may have made you not attempt to access other funding options. Of course, you need to research your credit score. A personal loan for a home improvement loan may be more accessible than you’d imagined.

Secured Loans – Another type of Personal Loan for Home Improvement

A Secured Loan typically involves some kind of collateral (a house, car, boat, or other valuable item). The rate of interest and terms may vary. It’s often easier to get a secured personal loan for a home renovation project from a financial institution because they are holding the asset if you default on the loan.

The options for personal loans sometimes really seem endless. That may just be because there are lots of options, and they are all designed to fulfill various requirements. I’m glad to know that there are options that will help me. So, why take out a secured loan? The most obvious reason is because I need it, but there are a few more salient reasons. Here are some top reasons why I’ve considered (and taken out) loans in the past.

At this point, it really doesn’t matter why I need a personal loan for home improvement projects. What is important is getting the money that I need. It’s essential. Then, the next step is to evaluate my options for personal loans. I need to know what options are available, the costs, and the pros-and-cons. I also need to be aware of how that loan will affect my future financial health.

It’s difficult to take a step back and really study my situation, particularly when I’m right in the midst of an emergency (it’s too stressful). When I need money right away, I just want to drop everything. We can’t give in to panic, though. I need to take time and carefully analyze the options that are available to me.  (And you do too.) Which option will be the best?

Other Options:

By the time I’m looking at loan options, I’ve already taken a look at other options.  So, if I’m still looking for more options, the money situation is just that bad. I have probably already tapped out on all the other finance and credit solutions. I’ve covered previous expenses and other unexpected costs with a credit card, savings, or even borrowed funds. There comes a point, though, when all my other funding options are used up or non-existent. So, then, I begin the process of searching for alternative funding sources. That guaranteed loan option is sometimes the next best step. It’s the only solution that’s left to me.

Home Repairs is Another Use over a Remodel

Your Guide to Personal Loans for Emergency Home Repairs

A personal loan can be used for just about any reason. Sometimes emergency home repairs just come up for unexpected reasons. Perhaps, you need a loan to take care of the home emergency. These can be called home repair loans, personal loans for home repairs or what ever you’d like. In the end, you’re borrowing money to cover the cost of an emergency in your home, condo or apartment. You’re taking out a personal loan. Typically, you need cash fast for a emergency at home and as always you want make sure to pay it back as soon as possible.

Can I get a personal loan for home improvement projects?

Sometimes a personal loan is the only way to really get to the home improvements that I want and need. While home always has felt like a dream. There’s something about actually owning a home that makes everything come crashing down. It’s so expensive. Even the most basic renovations really add up in time and cost, so it becomes really difficult to fix up my dream house when my finances just make it impossible to support even the slim slice of those machinations. Who has a whole truckload of money and supplies just lying around to make that dream house a reality?

There are solutions that are really easy to understand, and just what they sound like: personal loans for home renovations.  While it would be nice to have ready cash lying around to cover every fix-it-up expense and consideration, that’s not the world I live in. In my world (the real world), I make arrangements for repayment over a period of months and years, depending on the value of the loan. With costs that quickly ramp up to, how else do I easily just fix the house and make sure it’s safe for my family. Fortunately, I’ve found solutions that can help: home renovation loans.

When I am broke and faced with the real costs of home renovation, my credit score and employment history are important factors. Obviously good credit might make my search for a home renovation loan easier, but bad credit does not ruin all my chances. And, it may actually be a positive thing for me to take out a loan. Here’s why:

  • If I take out a home renovation loan, and then pay it off, it might just go toward rebuilding my credit. It could help me to get my finances back on track.
  • Then I can also dig into my overall credit situation, learn as much as I can and start to find out what has caused my poor credit.
  • Finally, I can also work on improving my credit score before you take out the loan.

Bad credit makes my situation more complicated, but I know that I can turn it around. Instead of focusing on all the negativity, I can focus on what good might actually come out of this entire educational experience.

Where to Get A Personal Loan for Home Improvement Projects

Personal loans for home improvement projects are usually easier to get because there’s less risk for the lender. They are typically tied to a paycheck, a bank account, a car title or some other form of collateral. So, there’s the sense that it’s a “safe” investment. In other words, it’s tied to the things of value that I have available at my disposal, even though I don’t have the money right now to pay for fixing my car or buying groceries.

With my already bad credit, I just don’t have good access to financing. I don’t have the ability to use my credit card or other line of credit to finance emergencies or unexpected expenses. So, I look to personal loan options to cover flexible financing solutions or those unexpected expenses. It’s a pretty straightforward process though.

  • I fill out the paperwork, being sure to include all the details they’re requesting.
  • Depending on the type of loan that I get, I may be required to give the lender access to my bank account.
  • Alternatively, I may have to write them a check, which they will cash when the payment is due. The amount will cover the loan plus the finance fee.
  • The lender processes my information and determines how much (or if) they can offer me the loan.
  • I (hopefully) receive the loan in the form of a check, cash or money transfer—typically in 24 hours or less.

At this point, it really doesn’t matter why I need the guaranteed loan. What is important is getting the money that I need. It’s essential. Then, the next step is to evaluate my options for guaranteed loans. I need to know what options are available, the costs, and the pros-and-cons. I also need to be aware of how that guaranteed loan will affect my future financial health.

It’s difficult to take a step back and really study my situation, particularly when I’m right in the midst of an emergency (it’s too stressful). When I need money right away, I just want to drop everything. We can’t give in to panic, though. I need to take time and carefully analyze the options that are available to me.  (And you do too.) Which option will be the best?

What Loan Solutions Will Work?

There is always a myriad of options to consider no matter what my financial history is. Some solutions will just work best for me in the short-and-long term. My goal is to use the solutions that will help me build my credit and successful navigate the hard times until I can climb out the other side. It’s not always easy, but it’s great to know that there are loans that will allow me to survive those unexpected emergencies. I just need to review the pros and cons for each possible solution and then move forward strategically with what I need.

How can I find a Personal loan for home improvement projects?

I get it. Everything is expensive. Eating and fixing my car sometimes even seems like a non-essential luxury. But I do have those essential requirements that I sometimes just can’t do without. That’s why it’s great to know that there is a loan I can get to cover those unexpected bills. All of those expenses and bills add up, particularly with kids. But, where do I start, and how easy is it to get a loan when I need it for the amount I really can’t do without?

I need to check my credit first to get a sense of which type of finance option I need, or which one will fit with my financial situation.

I also need to figure out where to get a loan. Based on my credit score and loan amount needs, here are tools to help you find a lender when searching for personal loans for home improvement projects:

  • Short-term more small dollar loan lenders can be found on Cashry.com
  • or use Loanry.com, which offers higher dollar personal loan lenders and many other types of finance products.

emergency repair loans

These sites are not lenders themselves, they simple help you find a lender.

There are always risks when I borrow money. After all, I need it, so I’m willing to go the extra mile to cover my broken-down car, unexpected expenses, bills, or grocery list. Probably the largest danger is that I would just not be able to pay the loan back at all, and I could be charged additional fees and penalties in addition to the interest rate. Of course, another consideration is that I could further damage my credit or incur other liabilities.

I don’t always realize what kind of impact my credit score, payment history and credit usage will really be. (It’s not always as bad as I’m imagining.) So, the first step is to determine what my credit score is, and also what factors are affecting that rating. Equifax, Experian and TransUnion are the three credit reporting agencies, so I go there. I can access my credit score from a number of online portals and financial-planning resources.

As part of my credit research, I can also determine factors that may have downgraded my credit, including how solid my payment history has been and also how much credit I’m already using. This whole process goes far beyond just checking the accuracy of those credit reports, though. I also really want to learn what actions I must take to improve my financial health in my current situation.

It’s really not as difficult as I thought. That’s what really excites me. I want a solution that will be quick and easy. But I need a loan that will allow me to live my life and not worry so much. Is that too much to ask for? I want to enjoy life again. It looks like a loan finance solution can help me. For that, I will be forever thankful.

Personal Loan for Home Improvement Projects As Soon As Tomorrow

I’m looking into the best (and easiest) options for a home renovation loan. Unsecured personal loans online allow me to take out a loan that will take the edge off. It can make the planning process that much easier. And, with Loanry.com, I can find a personal loan lender with less hassle. I can get an emergency cash loan or even a rent loan within budget. It’s fast, painless, and might even get me back on the right track.

Getting A Personal Loan to Consolidate Debt to a Lower Interest

If you are like most people, you have some kind of debt. Maybe you have only a little bit of debt that is good for you, like a mortgage. Unfortunately, the reality is that many people have a lot of debt. According to Forbes, 40 million households are house poor, meaning they have a house they cannot afford.

Many more than that are in so much debt, it would take them over ten years to get out of it. As a result, we have resigned ourselves to being in debt and constantly putting ourselves further into debt. It does not have to be like that. There is a better way. Continue reading to find out how to consolidate debt to a lower interest. This could be the start of a debt-free life. Wouldn’t that feel like a huge relief?

Debt Consolidation With Low-Interest Personal Loan

I never want to assume that people fully understand their finances. The more people I talk to, the more it seems that people often just let things happen when it comes to their money. They open credit cards and accumulate debt without ever understanding how it works. They apply for loans without ever reading the fine print. I want to change that. I want everyone to take control of their finances and understand the decisions they are making. Let us start here with basic information about personal loans.

What Is A Personal Loan?

A personal loan is when you borrow money from a lender with the promise to pay it back in regular monthly payments. That lender can be a bank, a credit union, a personal loan finance company, or even a friend. You borrow a set amount of money at interest. That interest rate depends mainly on your credit score and from whom you borrow the money.

You agree to pay back the money within a set amount of time, usually three to five years. As long as you make your payments each month on time for the specified time, everyone is happy. If you miss a payment or make late payments, your credit could be negatively impacted. Personal loans can be a great tool to get control of your finances if used properly. You can use a personal loan to consolidate debt to a lower interest.

Can I Use A Personal Loan To Consolidate Debt?

Yes, absolutely, you can get a personal loan to consolidate debt to a lower interest rate. That is really the ideal scenario when it comes to debt consolidation. What you are hoping to achieve is lower interest, with one monthly payment from you to pay off all of your debts. You can choose any loan places you wish for a personal loan. You can even choose to find unsecured personal loans online to pay off your debt. The key is to get a loan that pays off all of your debts.

This way you focus on making one payment per month to decrease your debt. If you have extra money each month, you can make extra payments to pay off the loan faster. When you are focused on one payment, this is much easier to do. One thing I want to caution you about is when you have consolidated your debt and making only one payment that you do not get yourself back into debt. Making a plan for yourself to pay the monthly payment is the best course of action. When you have a plan, you are in control.

Is A Personal Loan A Good Idea?

This is really a question you must answer for yourself. It could be a good idea to consolidate debt to a lower interest, if you can afford to. Remember when you borrow the money, you have to pay it back. If you cannot afford to pay it back, you should not borrow the money. You need to take a long look at your budget and decide how much you really can afford to pay per month.

Do not get yourself into a situation where you cannot afford to pay back the loan. This only makes your financial picture much bleaker. By attempting to consolidate debt to a lower interest, that should free up money for you that you can use to pay back the personal loan.

You can always count on Loanry to connect you with reputable lenders and may even make the entire process a bit easier for you. Our partner Fiona may be able to offer you some options depending on the information you put in below. See if you qualify for a loan with any of the lenders:


How Can I Use A Personal Loan?

You can use a personal loan for anything that you want. A lender may ask you what your intention is for the loan, but that rarely is a determining factor. Once you have the money in your bank account, it is your to do with what you want. However, I would recommend that if your intention was to pay off debt, then you should pay off debt. Do not play with the money. Do not think you can gamble it and double your earnings. That rarely ever works out well. It is not worth the risk.

Can A Personal Loan Improve My Credit?

The short answer is yes, a personal loan can improve your credit. When you consolidate debt to a lower interest, you are paying off all of those other debts at one time and focusing on just one loan. This allows you to make your payments on time. This prevents you from missing payments. All of these things can help improve your credit. The biggest reason for bad credit is missed or late payments. When you are making only one payment, it should be easy to make sure you pay it on time.

Often times, when you take out a personal loan, even when the interest is high, it is still lower than credit card interest. Credit cards often get people into a bind. It is easy just to use them and not pay attention to how much you are spending. But, you always have to pay for it. When you get that bill and you cannot pay it in full, you have interest (or finance) charges.

When this happens month after month, those finance charges just pile up. So, when all you are able to pay is the minimum payment and the interest charges each month are more than the minimum payment, you are in a world of hurt. This is when a personal loan can help you. You can consolidate all of the credit card debt into one static monthly payment. Just remember, do not continue to use your credit cards.

Interest Rate By Lender
CLICK TO VIEW REAL-TIME RATES: Rates Subject to Change

What Is A Debt Settlement?

I want to shift gears slightly to talk about debt settlement. Many times when you owe money to a creditor, they may be willing to negotiate a lower debt. You can contact any of your creditors at any time and ask if there are willing to make a settlement. When you negotiate a lower debt, both you and the creditor are agreeing to the terms. Sometimes, the creditor allows you to pay a certain percent of the debt across a certain number of payment.

So, you may be able to pay 70 percent of the debt in 8 months. Another potential settlement is paying a one-time lump sum amount to satisfy the debt. It might be 25 percent or 50 percent, but the creditor sees one lump sum payment now is worth more than however long it might take you to pay the debt in full. This could be an alternative to consolidate debt to a lower interest.

That sounds great, doesn’t it? Well, there is a catch. You have to keep in mind while this negotiating is happening and you are only making partial payments, you are not paying off the full debt. That has the potential to negatively impact your credit. Once the debt is paid, your credit should recover a little. If you already have bad credit, it may not be a real impact. Once it is low, there is not much further for it to go down. Your credit may have a positive impact on paying off the debt. This may be a good option for someone with poor credit.

What Should I Really Know About Debt Consolidation?

While the advantages to consolidate debt to a lower interest may seem fairly clear, let us focus on some of the disadvantages. Disadvantages to debt consolidation can include high-interest rates. Most of the people interested in debt consolidation have poor credit and high debt.

As a result, they may face height interest on their consolidation which makes their monthly payment higher. It could make it higher than they are currently paying.

However, it is important to note that most likely, only the minimum payment is made and that gets you no closer to being debt-free. So you made need a larger monthly payment to reach your desired result. The amount of time it takes to pay off the consolidated loan may be longer than you think. The higher your amount of debt, the longer it will take.

It does not take much time at all to get into a debt problem. It often takes consistent and long work (repayment) to get out of it. Your best bet is to talk to a financial advisor to get educated advice on how to proceed. You really need to understand how that monthly payment impacts you. If you cannot afford it, you are not helping yourself at all.

What Types Of Debt Can I Consolidate?

Debt that can be consolidatedYou can consolidate debt to a lower interest in the way that you want. You can choose to consolidate any debt that you wish. If you are going to consolidate some debt, you should try to consolidate all of it. You can put yourself in a bad spot financially by consolidating only some of it. You should take a look at all the money you owe and get the payoff amount. The payoff amount may not be what you think, so you should contact your debtors to verify the amount.

Gather all those amounts so you can get an accurate idea of how much money you need to borrow in a loan.  When you look for a consolidation loan, you can find one that is for the exact amount that you need. This can give you a clear picture of your interest rate and monthly payment before you even apply for the loan.

This is helpful information for you when making these types of decisions. I mentioned this before, but it is important enough to repeat. Attempting to consolidate only some of your debt may not be a good idea. This could put you in a worse place financially. You still have to pay the individual debts that you did not consolidate in addition to the payment for the consolidated debt.

Why Do I Want A Lower Interest Rate?

Personal Loan interest rates can make a huge difference to your monthly payment. One thing to understand is your credit score directly impacts your interest rate. The better your credit score, the lower interest rate you can receive. And let’s be real, you want to consolidate debt to a lower interest rate. If you do not get a lower rate, then what is the point.

That being said, it is important to really understand interest rates. Forbes magazine shares an enormous amount of information about interest rates. You should learn as much about them as you can. It will be beneficial to you in the long run, if you can gain a better understanding of the interest rates.

What you need to know right now is how those interest rates impact the bottom line for you. That translates to the amount of money you pay for your loan. Interest is what the lender charges you to borrow money from them. This is how they make money. Let me show you an example to make it easier to understand.

Let’s just say you are trying to consolidate $20,000 worth of debt. You have a fairly good credit score, so you find a loan with 10 percent interest. That means the total interest you pay is 2,000. Your total loan amount is $22,000. If you are paying back your loan in 36 months, that means your monthly payment is $611.11. That might be a little high for you, so you choose to pay it off in 60 months instead. That changes your loan payment to $366.67.

Now, let’s take a look at that same scenario with bad credit. Since you have bad credit, your interest rate is 25 percent. You are borrowing$22,000 at 25 percent interest. That means your total interest is $5,000. Now, you are borrowing $25,000. For a loan of 36 months, you are looking at a monthly payment of $694.44. For a loan at 60 months, that payment would be $416.67.

The only difference between those payment amounts is your interest. It is best for you to shop around and find a loan with the best interest rate. It will save you money.

 

Should I Get A Personal Loan Vs Debt Settlement?

There is no one clear answer for everyone here. It really depends on your situation. A personal loan is a great way to consolidate debt to a lower interest. If you have poor credit, it might be hard for you to find a lender that allows you to borrow the amount of money you need. Then you find yourself borrowing some of the money you need and only paying off half of your debt. This probably does not put you in a better position. If you find a lender that gives you the money you need, the interest rate may be through the roof and come with a ridiculously high payment.

Debt settlement has some advantages. If you can get your creditors to agree to a settlement amount and you can pay a portion of your debt, it could be a win-win. The settlement might have the debt removed from your credit record sooner and improve your credit. Keep in mind, a debt settlement may come with fees. Often times to settle a debt, you work with a debt settlement company. These companies charge fees to handle this for you.

They negotiate everything with the creditor and handle all the paperwork, but you could pay a hefty fee for it. If they are not able to negotiate a fair settlement, it may not be worth it to you to pursue. You do not have to use a debt settlement company. You can work directly with the creditors.

There may be a clear choice for you. If there is, go with that. But, there may not be one. Maybe either situation is not appealing to you. Or, maybe they both have benefits. In that case, pick the one that works the best for your situation now. No matter what you choose, do not continue to spend money that you do not have. Getting yourself out from under a ton of debt is a great idea, but learn the lesson and do not go there again.

Should I Just File For Bankruptcy?

Do you remember the days when it seemed like everyone was filing for bankruptcy? The reason for that is because it used to be easy to do. You could file Chapter 7 bankruptcy, which eliminated all of your debt that a process of liquidating assets and getting rid of everything. Just like that, the debt was gone. It was a black mark on your credit report. You were told seven years, but really, you could start building credit in about a year. By the time you got to the seven-year mark, you were in fairly good shape, providing during those seven years, you worked on building up your credit.

Things have changed a lot over the years and Chapter 7 is not so simple or easy. First, you have to go through a process of debt settlement, but this time with the words bankruptcy on your credit report. That black mark is like a hole burned into your report. It is incredibly difficult to bounce back. Now, not all debts are resolved with bankruptcy.

There are items that fall outside of it. So, after going through all the headaches, and having a black mark, you still owe money to someone. Bankruptcy is far-reaching now. It can prevent you from getting insurance, and even a job. It honestly is not worth it today. There are much better ways to consolidate debt to a lower interest. Even when you feel like you have no other options, dig a little deeper and look a little more. There has to be something better than bankruptcy.

What If I Have Bad Credit?

Maybe you know your credit score already. If you do not, find out what it is. If you do not know it, you cannot do anything to improve it. You should always be working to improve or maintain a high credit score. Those three numbers are the difference between getting a loan, or not. They are also the difference in how much money you pay in interest. Sometimes, a bad credit score can prevent you from getting a job. It is that serious and you should take control of it.

You may realize by now that having bad credit can be a vicious little cycle. You have bad credit and high debt, but you cannot pay off the debt because all you end up paying is the minimum balance. It would be in your best interest to consolidate debt to a lower interest, but you are having a hard time getting a loan because of your bad credit. What do you do?

The truth is that it takes hard, consistent work to increase your credit score. It is possible, but it is not easy. You could consider a debt consolidation service for bad credit to help you get control of all of your debts. There are some benefits to this plan. You are letting a company handle your debts for you.

They take over and negotiate with your creditors and get all of your debt combined into one payment for you. You are able to focus on making that one payment. This is typically lower than all the other minimum payments you were making. If you stay on track and do not acquire any new debt, you can usually be debt-free in just a few years. There are some downsides to consider, too.

Interest Rate by Credit Score
There are certainly smart ways to use a personal loan, like to consolidate debt to a lower interest and pay off all of your bills. You can also use a personal loan to help increase your credit score. When you make payments on time and work towards paying off the debt, this increases your credit score. There are also some really bad ways to use a personal loan.

If you currently are swimming in debt, it is not a good idea to take out a personal loan to go on vacation, or to buy a new TV for your house. You are only compounding your current problem and most likely making it worse. It is never too late to take control of your debt. You may feel like you are drowning, but there are ways to swim. You have to be smart about your financial decisions.

Conclusion

I talked a lot about needing to consolidate debt to a lower interest. That is always a good move when you have a lot of high-interest debts that you cannot seem to get a handle on paying. There is one thing that you really must consider when looking to consolidate debt to a lower interest. You must be able to make the payments.

You should never enter into a loan agreement that you do not understand and always know what the fine print says. Make sure you always understand how much you have to pay and when. Plus, you should be aware of all fees. If there is something you do not understand, ask. Do not sign anything until you completely understand all of it.

Do not get yourself into something you cannot escape. Make sure you can afford the loan. There is nothing worse than taking out a loan you cannot afford to pay. If you feel confident that you are making the right choice and you understand all the information and you can pay back the loan, then proceed. Then you can begin to feel the freedom of being debt-free.

Why Should I Care About Personal Loan Interest Rates?

Personal loan interest rates impact the decisions you make about whether or not to take out a loan in an emergency or for a specific need. They are not difficult to understand if you have a little guidance before plunging in and taking on new debt. Armed with knowledge and sensibility, you are more than capable of managing your debt and finding the best interest rates possible for loans.

How Interest Rates Impact Your Financial Decisions

Personal loan interest rates work both ways. If you borrow money, the interest rate is the amount your lender will charge for your use of their money. On the other hand, when a bank borrows your money from your savings account, you earn the interest the banks pay for the use of your funds. The Federal Reserve sets the interest rate and controls its movements and its direct impact on the economy.

Interest rates drive US economic growth. They also impact all costs involved with loans and how much return you will see from savings Low Interest Ratesaccounts and any investments. From a daily consumer viewpoint, these interest rates determine how much you will pay when you borrow for a car note, a student loan, or even a personal loan. When you invest or develop your savings account, interest rates determine how much will earn from those funds.

By paying attention to the current interest rate, you can increase your investment earnings and decrease the costs associated with borrowing money. Basically, high-interest rates give lenders an advantage while low-interest rates benefit borrowers.

Following an interest rate hike by the Fed in March 2017, banks began to raise their rates for savings accounts. This demonstrates how increased interest rates will earn more return on savings accounts but will inversely cause personal loan interest rates to cost more. The key is to take full advantage of higher interest rates, particularly when you are saving for big ticket items such as a home or higher education.

When you see that interest rates are dropping, this is the perfect time to refinance your current home or explore options for your first mortgage. Keep an eye on interest rates as the Fed doesn’t alter the interest rate often. They proceed only when they feel that the economy is strong enough to handle the fluctuation. For entrepreneurs starting a new venture, interest rate hikes are viewed as positive economic indicators.

Why Personal Loan Rates Matter

When you need a little extra help, personal loans are there. You can use them for medical bills, unexpected expenses, or even debt consolidation. To determine personal loan interest rates, lenders consider income and financial history. They will also look at your current amount of debts. For the most highly qualified applicants, they will offer the prime interest rate but their credit history must be impeccable. For applicants seeking a personal loan, a Fed interest change mean that any interest rates associated with a loan will also change. This is a fact of the marketplace and not dependent on credit history. If you are wanting to use a personal loan to consolidate high rate interest credit cards or debt, the perfect time to do it is when interest rates are low.

Why You Should Care About Loan Interest Rates

When deciding to apply for a personal loan, your credit score will be a primary consideration. But whatever your credit situation, even bad credit, there are options that can help you. To help you understand your position and the options available to you, we’ve compiled information on personal loan interest rates and the necessary credit score to access them. The first step is to review your credit score if you haven’t done so already. While we are not lenders, we enjoy helping people to understand their credit and the loan options that are available to them.

Personal Loan Interest Rates

When looking at personal loan interest rates, it’s a simple matter of economics. The better credit score that you have, the lower your personal loan interest rates will be. The same is true with “Fair” or “Bad” credit, your personal loan interest rates and fees will be higher because you present a greater risk to the lender. But before you get too worried, there are things that you can go to improve your score before applying for a personal loan. Taking the time to clean up past delinquencies or inaccuracies will get you a better interest rate in the future. While there are personal loans available for individuals with every credit type (good, fair, poor), the lender to work with and the interest rates they offer will depend on your credit score.

Your Credit Score and Interest Rates

If you do decide to take out a personal loan, realize that past loans impact your ability to get future loans. So, be responsible and reasonable about the repayment plan. If the repayment plan is one that you can handle, you can lower the future personal loan interest rates. So the lesson is to always responsibly manage any credit cards or loans that you have.

Be diligently paying them off in a timely manner, you will gradually see the results with an improved credit score and lower personal loan interest rates when you apply in the future. This is your pay off for working hard to improve your credit score. The bottom line is that continually working to improve your credit score is imperative. By pursuing these actions before applying for a loan, you’ll reap the benefits of lower personal loan interest rates and that will make paying off the loan even easier.

CREDIT SCORE CREDIT SCORE TIERS AVERAGE PERSONAL LOAN INTEREST RATE
Excellent 720-850 9.8%
Good 690-719 15.0%
Average 630-689 21.3%
Poor 300-629 28.2%

Interest Rates for New Credit Files

For people with no established credit history, the initial personal loan interest rates they are offered are often incredibly high. This is because they have not established a credit score or a reputable history of being responsible in credit situations.

At times, it may even be as high as 34% APR. The good news is that after they demonstrate that they can responsibly manage the credit that they are offered, the interest rate will be gradually lowered to about 7% APR or less.

While the credit score is only one factor lenders use to determine the interest rate they offer you, it’s still very important to work on it. It won’t change immediately but, over time, you’ll see the results that you want.

The reality is that it may take a couple of years but persistence pays off. Hanging in there and being diligent will affect your credit score. It can even impact your work and other areas of your finances as many employers require a credit check before offering a new job. So, stay on top of repayments and check your credit score frequently.

While you are checking your score, be sure to look for any errors or discrepancies. If you find them, report them immediately to the credit bureaus as they can negatively impact your credit. Don’t expect anyone else to find the problems and correct them. The world does not work that way. Report errors and contest them for you can get them out of your record.

What You Should Know Before Taking Out A Loan

 Before applying for a personal loan, there are a few things that you need to understand before taking one out. There are a wide variety of personal loans for many different reasons. It could be that you need the funds for any of these reasons:

Taking a personal loan doesn’t need to be a negative experience. As long as you stay on top of the whole experience, you’ll make the best decisions for your situation.

Keep Your Credit Score in Mind

Your credit score and credit history tell lenders a lot about you. Lenders can quickly see how much risk they take on if they approve a loan. It also lets them know in advance, how responsible and diligent you are about adhering to a timely repayment plan. They are much more likely to give a loan to someone with a ‘good’ or ‘fair’ credit score in the amount they are requesting. If you have a ‘poor’ credit score, there are still options but they won’t be as favorable.

Broadly speaking, most lenders will need a 660-credit score or better for a personal loan. The higher your credit score, the less risk you present. But your credit score is not the only factor that lenders consider, they also want to see your income.

Online Personal Loans

Today, people have many options when they are considering taking out a personal loan. With online lenders, you have more options for getting the unsecured personal loans online you need at an interest rate you can manage. At Loanry.com, we are not lenders but we are here to help you find a lender who may be able to help. There are also a variety of educational tools and information to get you on the right path. Shop the site for lenders and compare terms using money tools to get the right fit for you.

If you want to look into the best online lenders, our partner Fiona has selected a couple you should consider. You can fill out the form below and Loanry will match you with lenders who may be willing to give you a loan based on the information you provide. Start here:


The Role of Income in Personal Loan Applications

Personal loans are generally unsecured, meaning they don’t require collateral. So lenders look at income when considering personal loan applications. If they can’t seize your property, such as a house or car, when the loan isn’t repaid, they need to assess their level of risk. Looking at your income gives them the ability to determine your ability to repay the loan. To that end, the more money you have coming in, the larger the loan can be. This makes sense for you and them.

Also when some lenders look at income, they have predetermined amounts they will lend based on income amounts. If you don’t make enough money, they simply will not lend to you.

Personal Loan Interest Rates and Fees Explained

As you look at our finances and the amount of money you need, it’s a good idea to add interest rates and any fees. This will give you a better idea of what your monthly payments will be. It will also increase your loan amount to ensure you have anything covered.

Average Interest Rates for Personal Loans

“What are the average personal loan interest rates?” The answer is, “It depends.” But don’t be surprised if they are high. This is because there is no collateral involved, the lender is taking a greater risk by making the loan. With no collateral to ensure repayment, lenders increase the personal loan interest rates to cover their risk.

Other factors that affect the interest rate that you are offered is your credit score and the lender you have selected. From a prime lender, you can anticipate a personal loan interest rate of anywhere from 5% to 36%. That’s a broad range. Again, your credit score plays a big role in how lenders set the interest rate. A personal loan calculator get help give you a general idea.

What Fees are Involved with Personal Loans?

Any loan that you take out will come with fees. There are a few personal loan fees that are quite common.

Pre-payment Fees: If you repay the loan too early, some charge a prepayment fee. This is something to watch out for because some lenders allow paying early to avoid interest charges.

Origination Fee: This fee covers the lender’s costs associated with completing your loan paperwork and setting your interest rate. Considering it a processing fee.

Late Payment Fees: If you stay on top of your repayment schedule, this is one that you won’t have to deal with.

You can Save a Lot on Current Debt with a Personal Loan

In some situations, this is true. If you are being charged high fees in late penalties, you may need to consider another option. If your current credit card or loan has interest fees that are so high you can only pay the minimum amount each month, a loan at the lower rate might help. Also, if you have multiple credit cards or loans, it can be difficult to keep track of the multiple payment dates and charges. In this case, you need to decide if you would benefit from taking out a personal loan to consolidate your debts at a lower rate. Not only could it save you money, but it could save you time.

Understand Your Ability to Pay Back the Loan

The ability to get a loan at a certain amount doesn’t always mean you should. Lenders use certain standards to set your loan amount. That does not mean that it is a perfect system, though. You’re a better judge of your ability to handle a certain size loan than they are. While the lure of loan is great in the immediate present, you also have to consider the long-term implications of paying off the loan in the future.

The biggest issue that you need to consider is whether or not this loan and the repayment schedule will become a burden in the future. You may have a current need that you need to resolve but a bigger loan than you can handle will become a future problem. Being realistic with yourself about your finances is essential when considering a personal loan.

Personal Loans are Short-term Solutions

When you are facing complex financial situations, a personal loan can be a solution in the short-term. They can help you out of a jam but you will not be successful with a loan if you are not earning enough income to cover them.

The best advice is never to borrow more than you need. Remember that you will also be dealing with personal loan interest rates so its best to keep the loan at a reasonable amount. To realize the benefits of personal loans, look at them as financial tools to help with your goals. They can be used but only sparingly.

Location for Shopping for Personal Loans

There are variety of places where to get a personal loan. These include traditional financial institutions and modern online methods.

We’ve shown you how your credit score and income level play into the interest rate lenders offer for a personal loan. You’ll also want to loan shop for lenders that will give you the best interest rate. As you do so, trust your gut to avoid loan scam artists who will ask for an upfront fee. Don’t do it.

Low Interest Personal Loans

As mentioned earlier, lending companies consider personal loans to be a riskier loan option because they do not require collateral. However, they can be helpful when you need cash. Also, they can be used in a variety of ways including medical bills, emergencies, or improvements to a home. The interest rate needs to be a primary consideration. There are online and traditional bank loans available off low interest rates. You just need to shop for them, particularly if you have a “good” or “fair” credit score.

Good Credit Score

We know that any potential lender will consider your credit score to determine your personal loan interest rates. They will look at the amount and type of debts that you have and how consistently you’ve paid them off. If you have a “good” credit score, you will be able to find the best rates.

With a credit score of 740 or above, you are considered to be a good risk by lenders. Meaning there is a lower chance that the loan won’t be paid back. With an unsecured personal loan, the lack of collateral does make them more difficult to obtain. But with a “good” credit score, you’ll have an increased chance of getting a lower interest rate.

People who have credit scores in the 650 to 739 range are still considered to be good credit risks by lenders. While they won’t offer you their lowest interest rate, you should be about to secure on in the middle range. This is when you may want to consider delaying taking out a personal loan until you raise your credit score to 740. If you can wait, this will get you a better interest rate.

Think About Your Current Debt

If you currently have outstanding debt, you need to consider it before taking out a personal loan and accumulating additional debt. Be sure to include everything that you currently owe. While you’ve probably first thing about credit card debt, you may also have a mortgage, store credit cards, or a car payment. If you want to secure a personal loan with the lowest interest rate, it’s in your best interest to have as little debt as possible.

Compare Companies

Interest Rate By Lenders  Lender’s APR
Affirm 10.00% – 30.00% (0% APR offered at select retailers)
Alliant Credit Union 6.49% – 10.49% with AutoPay
American Express 6.90% – 19.98%
Avant 9.95% – 35.99%
Backed 2.90% – 15.99%
Best Egg 5.99% – 29.99%
Citibank 7.99% – 17.99% with discounts (rate may be higher)
Citizens Bank 6.80% – 20.91% with AutoPay
Discover Personal Loans 6.99% – 24.99%
E-LOAN 7.99% – 35.99%
Earnest 6.99% – 18.24%
FreedomPlus 5.99% – 29.99%
KeyBank 7.49% – 15.24% with AutoPay
LendingClub 6.95% – 35.89%
LendingPoint 9.99% – 35.99%
LightStream 3.99% – 16.99% with AutoPay (rates vary by loan purpose)
LoanStart 4.85% – 35.99%
Marcus 5.99% – 28.99%
Mariner Finance Up to 36.00%
Mr. Amazing Loans 19.9% – 29.9%
Navy Federal Credit Union 8.19% – 18.00%
OneMain Financial 16.05% – 35.99%
Payoff 5.99% – 24.99%
Peerform 5.99% – 29.99%
PersonalLoans.com 5.99% – 35.99%
PNC Bank 5.99% – 25.44% with AutoPay
Prosper 6.95% – 35.99%
Regions Bank 7.50% – 18.83% with AutoPay
RocketLoans 7.161% – 29.99%
Santander Bank 6.99% – 16.99% with ePay
Self Lender 10.58% – 14.77%
SoFi 5.99% – 16.74% with AutoPay
TD Bank 6.99% – 18.99% with AutoPay
Upgrade 7.99% – 35.89%
Upstart 7.46% – 35.99%
Wells Fargo 5.49% – 22.99%

Final Thoughts

While shopping around for personal loans, be sure to shop around the different lenders so that you develop an understanding of the numerous terms and conditions available to you. The first offer may not be the best one. Fees and interest rates will vary from company to company. When you can narrow it down to three potential lenders, be sure to spend some time looking at their loan contracts. Some companies may have additional hidden fees or conditions that may not be immediately apparent.

 

How Do No Hard Credit Check Loans Work?

No Hard Credit Check Loans

What are some no hard credit check loans? Traditional unsecured personal loans online will require a credit check and your credit score is an important part of the process, but there are options for no hard credit check loans.

Everything About No Hard Credit Check Loans

No hard credit check loans can be a good option for those who have bad credit and don’t want a credit check on their report. When speaking about credit checks, it’s important to know the difference between a hard and soft inquiry since each one will affect your credit a bit differently. Here is the list of no hard check credit loans:

Payday Loans

This is the leading type of personal loans that don’t require a credit check. You can find these loans online or through your local community. A payday loan will usually come in an amount that is equivalent to your paycheck or less. They will need to be paid back completely in one or two installments.

Local Financial Lenders

Financial lenders in your area can also offer no hard credit check loans. These lenders will advertise the service by mailing out checks that customers can take to their local bank and deposit. Once a check has been deposited the customer has accepted the terms of the loan, which will include the monthly payment terms that were attached.

If you are nervous about approaching lenders, you shouldn’t be because it can be in your best interest. Dealing with a lender directly, even if you don’t have a perfect credit score, will give you different options for approval such as proof of income or employment.

Title Loan Companies

You may have seen signs for no credit check required loans. These companies are offering quick cash loans with no credit check but there is a catch. These loans usually require you to secure the loan with your vehicle title. These loans are secure because there is collateral as a requirement. You are still able to drive your vehicle while you are paying off the loan but you will be required to surrender it if you fall behind on any payments.

Online Personal Loans

There are plenty of unsecured personal loans online options to credit shop. You can take advantage of a lender search tool that will give you a list of lenders that don’t require a credit check and start from there.

Where To Get a Loan?

There are different options for where to get a loan and one with no hard credit check that you can consider.

Online

Getting no hard credit check loans online can offer you a number of benefits, such as easy access, convenience, saved time, and low rates. When you apply for a loan online, you can do so from the comfort of your own home and you don’t have to wait in line or schedule an appointment. You will need the following information to apply for a loan online: name, address, Social Security Number, and proof of employment or income. Other information could be required, depending on the different standards of the lender. When you are filling out the form, it can be easy to miss a box so be sure you are paying attention. Missing crucial information can delay your loan.

If you’re interested in getting a personal loan online, you came to the right place. Loanry bring you carefully selected reputable lenders. You can enter your information and see if you qualify for a loan with any of them:


Easy Access

When you get a traditional loan, there are a lot of hoops that you have to jump through. However, a personal loan can require less information and may have more flexibility. The approval time is usually pretty quick. It can take weeks to get approved for a traditional loan, but online, you may even see instant approval. Depending on the lender, the longest you may have to wait for your funds could be three days, which is still shorter than a traditional loan.

Save Time

If you are in a hurry and need money quickly then it may be in your best interest to apply for a personal loan online. Traditional loans will have a lot of different steps before the loan gets approved. In addition to quick approval, there is usually a lot less paperwork, which can also help you save time.

Low Rates

Even with a no credit check loan, you can usually find lower rates online. It’s in your best interest to find the lowest rates since it will be less out of pocket money for you. One of the best parts about getting a loan online is that you can compare the benefits of rates from different lenders and choose the one that will suit your needs. Corresponding with an online lender can make the process easier and may help increase your chances of approval.

Credit Union

Credit unions focus on the community so they will be local to your state or specific region. They will also work together to better serve you. Many of the services a credit union will offer will be more convenient than a bank. Getting a loan from a credit union means you aren’t just an average customer and, if you become a member, you could have access to lower fees and better rates.

Banks

Getting a loan from a bank will come with some advantages and disadvantages, depending on the type of loan you are getting. It helps to know the difference between a hard and soft inquiry when getting a loan from a bank. It’s also important to know about the two types of loans and the pros and cons of unsecured and secured loans. If you are getting a loan from a bank, you want to choose an unsecured loan. This way you don’t have to worry about your assets, including your home. Experiencing financial hardship can make repaying the loan difficult and you don’t want to risk losing everything you have worked hard to get.

What Credit Score Do You Normally Need for a Loan?

One of the reasons you may be considering no credit check loans is because you know your credit score isn’t good enough for another type of loan. There are options for every credit type and it helps to know what your credit score falls under. Unfortunately, your credit will have an effect on a personal loan. Before getting a loan, you can do your best to fix up your credit.

When you are working on your credit score, be sure you that you aren’t applying for other credit forms at the same time and there aren’t a bunch of hard inquiries. You shouldn’t be falling behind on any bills or payments that need to get paid. Keep all your accounts open since closed accounts will look bad, especially any recently closed ones.

Good Score for a Personal Loan

A good score for a personal loan is between 700 and 750 and this means you will get lower rates and possibly fewer fees. This shows you have done what you are supposed to when it comes to credit and are paying down your debt for a lower debt-to-income ratio.

Fair Score for a Personal Loan

A fair score is between 650 and 700. This can be the case for many people and you have to work at the different ways needed to improve your credit score.

Bad Score for a Personal Loan

A bad score is considered between 560 and 650. Usually getting a loan with a bad credit score can be harder, but it’s not impossible. An option for a bad credit score is shopping for a loan from an online lender. It’s important to do your research and know that if you have a higher interest rate it can be harder to repay the loan. If you fail to repay the loan then it hurts your credit score even more.

What Makes Up Your Credit Score

There are a number of things that make up a credit score. New credit accounts for about 10% of the score. If you have recent loan applications or credit card applications these will play a role. Have you been approved or denied from these applications? Why have you been denied? It’s important to address these issues before applying for more money. The types of accounts you have on your profile will account for another 10%. Lenders want to see a mixture of accounts and make sure that you know how to borrow and repay from different sources.

Lenders will likely find out if these mixed accounts have been Credit Score Factorsopened impulsively by looking at your behavioral application patterns. Your credit history accounts for another 15%. During the time you have had a credit history, you need to show that you are responsible. Your debt-to-income ratio will factor in about 30%. Lenders want to make sure you don’t owe more than you are making and you aren’t using more than 30% of the credit in your favor. Payment history accounts for about 35%. Past and present delinquencies will be looked at, along with general payment history.

Can You Get a Loan without a Credit Check?

Even if you have found a loan that doesn’t have a credit check requirement, it’s still important to know the difference between a soft and hard inquiry. It is possible to get no hard credit check loans. However, getting no hard credit check loans is not easy. These loans can be useful in a number of situations, including emergencies.

What Can You Use in Place of a Credit Check?

Depending on the lender and the type of no hard credit check loans you are considering, there could be different items that can be used in place of a credit check.

Secured Loans

In place of a credit check, some lenders may use a form of collateral that has a value equal to at least the amount you want. Collateral can be anything from vehicles to electronics. You will also need income verification in order to get loan approval.

Unsecured Loans

Unsecured loans don’t require any collateral. However, you may have a higher than normal interest rate. This can double the overall payout of the loan. The higher the interest rate, the higher the monthly payment will be. You will also need to be prepared for income verification. This way lenders can make sure you have the financial means to pay back the loan.

In order to help understand your credit score, you need to know the difference between a hard inquiry and a soft inquiry. These different inquiries will affect your credit differently.

What Does a Hard Inquiry Mean?

A hard inquiry will happen when a lender checks your credit report. When you are in the process of applying for a loan, the lender will need to check your credit. They use a hard inquiry to determine whether your credit score is worthy and if you are financially responsible before denying or approving the loan application. You need to be careful with hard inquiries because they will remain on your credit score for at least two years. Too many hard inquires can lower your credit score. Applications that will count as a hard inquiry include auto loans, mortgages, student loans, personal loans, and credit cards.

The effect a hard inquiry will have on your credit report will depend on your unique credit history. For many, a hard inquiry will only affect your score by five points. What matters is how much credit you have and the accounts on your credit report. For someone who doesn’t have a well-established credit history, a hard inquiry would have a great impact.

Having multiple hard inquiries on your report makes you look riskier to lenders. If you look riskier, you have a lower chance of being approved for a loan. If you have six or more hard inquiries then you have a higher risk of filing for bankruptcy. These inquiries are what lenders will use to determine your financial risk before approving you’re for a loan. However, it doesn’t play as big a role in your credit report as other items, such as overall debt and late payments.

What Does a Soft Inquiry Mean?

A soft credit inquiry will happen when you or a company is checking your credit, usually in the form of a background check. This soft inquiry could be a mortgage lender that pre-approves you for a loan. Soft credit inquiries can actually happen without your permission and knowledge since they don’t affect your credit score. Some examples of soft inquiries include viewing your credit, pre-qualified credit card offers certain kinds of payday loans, and background checks or employment verification.

Reasons Loans Can Be Rejected

There can be a number of reasons why a loan is rejected. Some of it has to do with your credit report. If you are using a no hard credit check loan then your credit report won’t play a role but other items may. If your employment is unstable because you change jobs frequently, this can be bad. This is also usually a bigger deal for those who are under 30 and in the job hopper generation. Too much instability can be a bad thing.

Layoffs can happen and companies can change but you need a steady employment history in order to get the best interest rate on your loan, especially if you aren’t using your credit history to back you up. If you have insufficient income overall, you can also be denied a loan. You need to prove that you will make enough money to be able to pay it back. If you have been shopping around for a loan a lot recently and have too many loans out or too many applications with rejections, this could be a reason why your loan gets rejected. When you have too many rejected applications then be sure to give it some time before you start applying for new loans.

Should You Avoid a No Credit Check Loan?

While the interest rates can be higher on no hard credit check loans, if this is your only option you shouldn’t avoid it. Some states have capped the annual percentage rate that can be charged on loans. If you live in one of these states, this can benefit you. If you don’t live in one of these states with restrictions then you should know that you should see interest rates that are higher. Some lenders may not charge interest if you pay back the money by a certain date. If you can feel confident in your financial position in order to pay back the loan, this can be helpful to get a lower interest rate.

However, if you don’t pay it off in time then you could end up in a cycle where you are just paying interest and not making a dent in the balance of your loan. You may want to avoid title loans and payday loans since both of these loans may require that you pay back the loan quickly and it usually is within a month of taking out the loan. Both of these options can present the danger of not being able to pay back the fees and interest. If you choose a title loan then you can end up losing your car and be in a worse financial situation.

Being Pre-Approved Versus Pre-Qualified for a Loan

Some lenders can use the terms pre-approved and pre-qualified interchangeably. Other lenders will have different ways of viewing these terms but the process could be similar. Being pre-approved or pre-qualified can trigger a hard inquiry on your credit report.

In order to apply for a loan, it may be a requirement to provide more information about your financial or employment background. A hard inquiry will require your consent. You may be pre-qualified for a loan and not want to commit to a deeper credit search until you are ready.

How to Pre-Qualify for a Loan

There are a number of reasons to get a personal loan, including even helping with your credit, but it’s important to know about the process in order to know how it benefits you. As you are shopping for personal loans, you need to know the lender’s pre-qualification process. To pre-qualify, you may need information about your current financial situation and your employment. This can include the name of your employer, how long you have been with the company, and your salary.

Some lenders could also ask about previous employment. Other requests can include auto, mortgage, and other loan information. Lenders want to know about your payments. By self-reporting this, it can help them assess the likeliness that you will qualify. You can either choose to accept or decline a pre-qualified offer. However, you can use the offer, which should include the interest rate, and the monthly payment amount in order to decide which lender could be the right choice for you. Lenders can get the information they need to pre-qualify you with a soft check so you can get different quotes without having to have a hard inquiry on your report.

How Do You Improve Your Credit Score for Any Future Loans?

While improving your credit score takes time, there are ways to do it for future loans if you don’t want to consider any hard credit check loans. Some of the tips to improve your credit score include staying current on bills, reducing debt, and taking on a co-signer. It’s important to always pay your bills on time and not let them be 30 days late.

Once you have met the 30-day threshold, the lenders will usually apply this to your credit report and it will decrease your score. Most items will stay posted for about two years once they reach your credit report. If you have outstanding debt, such as medical bills or loan payments, try to pay them off as quickly as possible. A lot of debt can cause your score to go down because it increases your debt-to-income ratio.

Alternative Loan Options

There are other alternate options in the place of no hard credit check loans if you choose. If you feel comfortable with it, you can reach out to a friend or family member that is financially stable and ask about getting a personal loan from them. Since it’s not a conventional loan, there won’t be a credit check. You may also not see offers with overly high-interest rates that some local lenders may have. Even if it is not a traditional loan, you still need to make sure to pay back family members and friends.

Personal Loans No Credit Check: Check Here

The other option is a cash advance. If you have a credit card, there may be the option for a cash advance. Take the card over to the bank and have a cash advance taken out on the card. This will show in the overall balance. Cash advances do tend to have a higher interest rate than a normal credit card interest rate, which can be already high. It may still be less than what a local lender is offering you. The cash advance will combine with your normal monthly credit card payment so this will eliminate the need for a second payment and you can keep better track of your finances.

Conclusion

There are a number of different places to find no hard credit check loans but online can be your best bet in order to do your research and find the lowest rate possible given your situation. Pre-qualifying for a loan can be a helpful option but each lender will have different pre-qualification guidelines you have to adhere to. It’s always a good idea to work on improving your credit so you can get better loan options for the future.

How to Find California Installment Loans Online

How to Find California Installment Loans Online?

So you just got hit with a bill you did not expect, your car decided to break down, maybe your child needs an expensive prescription, or you were out of work due to illness and are now behind on bills. Whatever the case, you have found yourself in need of a loan, but you have no idea how to find one. You may also need some more basic information on personal loans just to make a decision. Good news: you are not the first one. In fact, it is common enough that we decided to write an entire article dedicated to it. It includes some of the most frequently asked questions about California installment loans and the answers. Happy reading!

How Do I Find California Installment Loans Online?

To find California loans online, you simply need to Google. By searching the term “California installment loans online”, you will get a lot of results for online lenders. In fact, you will likely see so many results that you are not sure where to start. That’s okay. We can help you there, too. “How?”, you say. I am so glad you asked.

It would be so much simpler for you to apply for multiple loans at once with legitimate lenders, right? Well, we provide just that platform. Loanry provides a secure site to provide your information and may find you an online california lender that fits your needs. You already work hard- let us take the overwhelm away by doing what we do best.

How Can I Use California Installment Loans?

The lovely thing about California installment loans is that they are so versatile. You can use them for pretty much anything you like. Want a

California Cash

vacation? Get a loan. Want to pay off some high-interest debt? Is your wedding coming up? Are you receiving disconnect notices on your utilities? Need to move in a hurry? Is your car broken down? You get the idea- California installment loans can do anything you need them to do.

Word of advice, though: borrow responsibly. What do I mean? Remember that the loan has to be repaid. It is not free money. Even if you decided not to repay a loan, you will pay in other ways- like if they sue you in a court of law, take your property, or report your lack of payment to the credit bureaus. Yes, all of that can happen.

So how do you borrow responsibly? It’s simple- just follow three simple rules: do not borrow more than you need, limit yourself to borrowing when it really is a need, and do not borrow more than you can pay back.

What Are the Benefits of California Installment Loans Online VS In-Person?

Well, first- and possibly most important to some- is that you can apply from home while in your pajamas. No getting dressed nicely with the extra makeup or silky tie that you normally use for impressing people (or is that just me?). Online lenders cannot see you, so you are off the hook. Whew!

Second, you can apply to a large array of lenders in short order whereas you would have to physically go to several places in your area. And all of that paperwork- talk about a hand cramp! When you enter your information to Loanry, the basic information will be shared with multiple lenders saving you a lot of time and pain. This may help you find a lender willing to work with your file.

And third, if you do not get approved, you did not waste any gas, makeup, dry cleaning, and hardly any time. On top of that, you do not have to do the walk of shame out of a lender’s office. I think that in itself is enough reason to apply online.

California Installment Loans vs Title Loans and Payday Loans

If you know anyone that has ever gotten a payday loan or title loan, you may be asking why you should put so much effort into an installment loan anyway. Payday and title loans are much simpler to get. While that is true- most of the time- those two loan types will dig you a much deeper hole than you want to be in. If you are considering a payday loan or title loan, halt! Do not pass go, do not collect $200- or $500, or whatever amount you are trying to get. Before you make that decision, let’s look closely at these. The following three examples are actually from my personal experiences.

Personal Loan Shopping

Payday Loans

I once took out a payday loan for $500. As most people are, I was convinced I could pay it back on payday. Then something else hit, so I paid the $80 in interest and borrowed the $500 again. Two weeks later, we had car trouble. I paid the $80 in interest again and used the $500 to fix the car. At this point, I had already paid $160 in interest. That should have been it, but it was not. For months I could not get out of that hole, and it was really about the high-interest rate. In fact, I paid more in interest than I borrowed in the first place. Payday loans are a trap- a vicious merry-go-round that is difficult to get off of once it starts.

Title Loans

Title loans are pretty much the same. I borrowed around $1,300 on a title a couple of years ago. The interest due every month was almost $400- just the interest. By the time I paid the interest, I could not afford to pay on the principle. I paid on that title loan for over a year and the interest I paid was astronomical.

California Personal Installment Loans

On the other hand, I once got approved for a small personal installment loan. I believe it was a total of $500. The interest was calculated for the entire repayment term and added on the amount I was borrowing. They then divided that amount by twelve months. I paid the required $52 a month and had the loan paid off on time. Because the interest was added in, the monthly payment included interest and principle. That meant that every payment I made was knocking down my loan amount, unlike the other two types.

I hope that you will take my experience into consideration and back away from the payday and title loans. Those should be a VERY last resort. In my opinion, they should only be considered an option if you need to pay for life-saving surgery or something equally as important, but maybe that’s just me. The point is that once you get trapped in the cycle, it is very difficult to get out of it. The best thing you can do for yourself is completely to avoid it in the first place.

Can I Get Approved If I Have Bad Credit?

Of course, you can- with some lenders. Some lenders will not approve of you without a certain level of credit score. However, there are those that will. These are lenders that factor in more like what exactly is on your credit, your income, your assets, and maybe even references. They consider a much broader view of your financial state than other lenders do. At Loanry, we are connected to a network of lenders- some who consider all credit types. We use your information to connect you with lenders that may match your needs.

Preparing to Apply

When you get ready to apply, you should gather a few items. In the beginning, you will likely only need your basic personal information and income. However, as the application process proceeds, especially if you are approved, have your ID, a couple of check stubs, a few references, and your credit score ready and available. If the lender needs anything further, they will let you know.

How Do I Choose Between Loan Offers?

If and when you get approved for multiple California installment loans, there are certain things you should pay close attention to. First, shop loan interest rates and repayment period- go for the lowest interest rate and longest repayment term you can find. Some personal installment loans offer as low as 6% interest and three years or more to repay the loan. This all, of course, will depend on the lender and the amount you are borrowing. As far as you can control it, though, remember, the less interest you have to pay and the longer you have to repay it, the better. Take as much pressure off of you as you can.

Second, you may get offered secured or unsecured personal loans online. A secured loan is going to require that you put up some type of collateral. This might be a check, a vehicle, a house, even a TV. If you do not repay the loan, the lender takes possession of that item. Putting up collateral is not always a good thing. Even if you have every intention of repaying the loan, you cannot control the future. Therefore, putting your only vehicle up for collateral could hurt you more than it could help. You should really think through this type of loan before signing the dotted line.

Loanry is one of the best places to look for an online loan. We connect you with reputable lenders and make possible for you to see whether you qualify for their loans. Put all the information required below and you may get offers:


Does the Loan have to be Secured?

You do not have to choose a secured loan, of course, but do note that you will likely get quicker approval with a secured loan than an unsecured one. An unsecured loan requires not collateral. Your agreement to pay is all they require. You might not get approved for as much with an unsecured loan, though, since the lender is assuming a great deal of risk. This also keeps you from having to worry about your possessions- especially if that possession is the only vehicle mentioned above.

Borrower Beware

This concern gets a section all to itself. It is important, so pay attention. As much as I hate that it is true, there are dishonest people out there that will steal your identity or scam you out of money. This means that you need to be extra careful when sharing your information online. Never share it on an unsecured site. If you do not know how to tell if a site is secure, just look up at the address bar when you are on the page. When you see a little green lock up there, you are good to go. If not, run away. The people who run the website may not steal your identity, but if the site is not secure, an outsider can. Watch your back.

You can also often check the ratings and reviews of different lenders. These will tell you a great deal about a company. Keeping up with legitimate lenders is a lot of work, though. That’s why we have done it for you! You can trust that we here at Loanry value your security and try to help you find a lender that works for your situation.

Now That I Have My Loan, What’s Next?

Once you get approved for a loan, there are a couple of important steps to take. The first is to read your loan documents yet again to make sure that you understand what you just agreed to. You do not want to find out when it is too late that you agreed to something you had no idea about. If you find anything in the documents that you do not understand, speak to your lender to get clarification. Trust me, they want you to know what they expect you to do as much as you do.

A Guide to Personal Loans in California: Loans 411

Next, immediately write your payment due dates down in your calendar and planner. I mean all of them. If you are making payments for 12 months, mark those 12 payments down now. For those like me who sometimes forget to look at their planner, add it into your Google calendar. That nifty little thing will remind you what is coming up due. And yes, I just admitted to needing an electronic item to keep me on track, but I am okay with that. With four homeschooled kids, a full-time job, and regular household duties, I need something to have my back. Do what you need to do to make sure you know when your payment is due.

Now, commit to repaying that loan. Do not be lax about it- be diligent. A tiny little loan can completely destroy your credit if you do not pay it. It is so much easier to mess up your credit than it is to fix it- trust me. So do whatever you need to do to repay it. Add it into your budget immediately. If you need to do without something a few times a month to make the payment, decide what that will be now. You need a concrete plan for repaying your loan.

Final Step

Finally, make a plan to help you stay away from loans in the future. Assess your situation. Why did you have to borrow the loan this time? Was it because of a surprise bill or some type of emergency? Or did you not have the money for your utilities due to the mismanagement of funds? Do you just not make enough to pay all of your bills at the moment? Whatever your reason, try to prevent it from happening again.

No, you cannot predict emergencies, but you can have an emergency fund. You can cut expenses, get a second job, start a side hustle, revamp your budget, and so on. Something likely went wrong for you to need this loan. Figure out what that is and try to find a solution so it is not a problem next time. No one wants to spend their entire life borrowing money, possibly going to the grave in debt. The earlier you can prevent the need, the better. Figure out how to stop the cycle now so that you can move into a financially stable life.

Conclusion

I hope that we have answered your questions with this article and that you now feel confident in whatever decision you make. A few last notes, do not jump headfirst into a loan agreement without understanding it. There will be a lot of information hitting you at once, so you probably will not catch it all at first. However, pay as much attention as possible. Take the loan and the loan agreement seriously, as much as you would your water bill or electric bill. Lastly, to be safe, come through Loanry to find a lender for you in California.

Do Personal Loan Companies Require Proof of Income?

We do not like to admit it, but we all fall on hard times. We have all seen times when we lose or decrease our income. There are even times when we face unexpected expenses for emergencies. We all wonder at some point where to get a loan. We also wonder how to find the best loan for my needs. Facing that situation is difficult and stressful, but finding the right loan does not have to be. You just have to know some key information and use tools to loan shop online. Continue reading to find out more information about personal loan proof of income.

What Is A Personal Loan?

Let us talk about personal loan basics, first. If you are considering a personal loan or even unsecured personal loans online, you should know some information. A personal loan is when a lending agency gives you money that you must back. You are required to pay back the loan with regular monthly payments over a set period of time.

That period of time is usually three to five years. That time period could be different based on the lender. Personal loans are considered unsecured loans, which means you do not have to provide collateral to get the loan. You often must provide personal loan proof of income.

Do I Need Proof of Income?

A lender always wants to see personal loan proof of income before approving you for a loan. For a regularly employed person, it is not difficult to provide proof of income to a potential lender. However, there are non traditional employees working. They may be self employed and do not give themselves a pay check. The total income of the business may be payable to the self employed person.

There are other individuals that have S Corporations, also known as S Corps. These individuals separate the earnings of the business from their personal earnings. This protects these individuals from a liability associated with the business. However, it also requires that this individual takes a paycheck. If he or she does not take a paycheck, that person really has no proof of income.

What Qualifies as Proof of Income?

For those who are not a typical employee and do not have a regular paycheck to provide to a lender as personal loan proof of income, have no fear. There are other Personal Loan Proof Of Incomemeans of proof of income that lenders accept. A W2 is an important tax document that tells a lender how much money you have made in the previous year and from which employers. A lender may also accept your tax returns if you are self employed. This clearly lists the income you earned for the prior year. However, keep in mind, a tax return only lists the income that you claim.

If you do not claim it, it does not show up on your tax return. Be careful and make sure you have claimed all of your income if you present your tax returns. You may also be able to provide a payroll schedule or payroll documents as proof of your earnings. This is especially helpful for those who do not get paid on a regular basis.

If you are a contractor or work as freelance employee, this may also be a great way for you to prove your income. A signed letter from employer is another personal loan proof of income that a lender may accept. This is a letter signed by your stating that you work for that company. This also acts as proof of income and that you are able to repay the loan.

You may also use bank statements that includes statements of direct deposit which shows that your employer has made deposits into your account. It shows how much is being deposited and how often. If you are of retirement age, a lender may ask for other personal loan proof of income.

You may need to provide statements of how much money you are receiving in Social Security benefits, if that applies to your situation. If you are old enough to supplement your income with investment income, a lender may request that you provide proof of that income. The same is true if you receive income from any type of retirement savings account. Be prepared to show proof of any type of income that you receive.

Can I Get a Personal Loan Without Proof of Income?

I am going to be honest with you here, it is difficult to get a personal loan without any proof of income. There are, however, other loans that you may be able to obtain. There is loan that does not require you to have a job. A title loan is when you use the title of a car, vehicle, or motorcycle as collateral for a loan.

The way it works is quite simple. You give the lender the title and the lender lets you borrow a set amount of money. You cannot borrow more than the value of the vehicle that you are using as collateral. Typically, the lender does an appraisal of the vehicle you are using as collateral to determine how much it is worth. In general, you have about 30 days to repay the loan. If you do not pay back the loan, the lender takes the title and keeps your vehicle.

How Much Money Can I Borrow?

Personal loan amounts can range from $1,000 to $100,000. Your income is a huge factor in how much you can borrow.

Lenders want personal loan proof of income to help them make a decision. You need to earn at least $15,000 a year to get a loan at the lowest amounts. If you want a higher amount such as $100,000, then you need to make 10 times $15,000, so roughly about $150,000. This type of income helps the lender feel confident that you have funds to pay the loan. Either way, the lender wants personal loan proof of income to provide proof of your annual income.

What Are My Chances of Getting Approved for A Personal Loan?

At the end of the day, the lender decides if you get a loan. There are certain things you can do to improve your ability to get a loan. You can help yourself by doing these things before applying for a personal loan. First, you should get a copy of your credit report and review it. There may be errors on it that you should fix before applying for any personal loan.

Determine your credit score, so you know where you sit on the credit scale. You cannot work to correct your credit problems unless you know your credit score. You should begin to pay down as much of your debt as possible. In addition, focus on your current debt by paying all of your bills on time. You must pay the appropriate amount on time every month to improve your credit score. Most importantly, do not file for bankruptcy as that stays on your credit record for seven to ten years.

Other things that impact your credit in a negative way are constantly changing jobs. Staying in a job shows that you have stability and make lenders willing to lend you money. It shows that you are responsible and more likely to not default on the loan.

Are There Different Types of Personal Loans?

Yes, there are several different types of personal loans. What really defines them as a personal loan is that they are unsecured. There are medical loans available to those who need money specifically to pay medical bills. There are vacation loans for those interested in paying for a vacation in one amount without having to save the money. Some are even taking out wedding loans when they need money for their wedding. You can get a debt consolidation loan that is a personal loan.

You can even get personal loans online. When you loan shop online be sure that the lender is a reputable one. Be aware that most online loans have a higher interest rate. No matter which one you choose you must provide personal loan proof of income.

Why Should I Care About the Interest Rate?

Interest rates are incredibly important. The most basic definition of an interest rate is the amount a lender charges you to borrow money. The base amount you borrow is the principle. For example, you want to borrow $10,000. That is the principle amount you are borrowing. The lender assesses your credit worthiness (more later in this article) to determine how much interest to charge. Interest is referred to as the interest rate. An interest rate can as low as 5% or as high as 29%.

Your credit dictates the interest amount. If the lender charges you 10% interest, that adds $1,000 to the amount you borrow. Now, you pay back $11,000. This does not include any fees the lender may charge. The lender uses this amount to determine how much you repay per month. A higher interest amount can significantly increase the amount you pay per month. Always be sure to read the fine print.

How Can I Qualify for A Personal Loan?

Now you think you want to apply for a personal loan, but you wonder if you can even qualify for one. There are some things of which you should be aware to help qualify before filling out personal loan paperwork. You must submit some type of personal loan proof of income. Lenders look at your credit rating to determine if they want to lend you money. They look at your debt to income ratio.

The best way to understand this concept is to understand the amount of money you bring in each month in income. Then you must understand how much money you owe in debts and expenses each month. When you have a good concept of these numbers then you can see the difference between the two.

Can I Get A Personal Loan with Bad Credit?

A lender uses your credit score to determine how safe it is to loan you money. Your credit score is an important three digit number that determines many things for you. It indicates to lenders how likely you are to pay back the loan and tells lenders what your credit history has been. It gives them a picture of whether or not you pay your bills and if you pay them timely.

A credit score can be any number from 300 to 850. The higher the number, the better your score. If your credit score is 800 – 850, it is excellent and if it is 749 – 700, it is really good. If it is 670 – 739, it is good and if it is 580 – 669, it is just ok. Anything below 579 is bad, or poor credit.

What Should I Do If I Have Bad Credit?

It is really hard to maintain exceptional credit. It is much easier than you realize for your credit score to drop. For example, it only takes some late or missed payments for the numbers to decrease. Unfortunately, it is much harder to increase your credit score than it is for it to decrease. It is not impossible, but it takes hard and consistent work. There are some things you can do to help yourself immediately. First, check your credit record and make sure that all the information listed is accurate.

If there is any wrong information, you must fix it immediately. You should begin to pay off as much of your debt as you can. You could also consider having a co-signer on your loan. Since personal loans are unsecured, there are no guarantees to the lender that you pay the loan. If you have a co-signer, that person promises to the bank that you will pay the loan. If you do not pay the loan, your co-signer is then responsible for paying it. There are some lenders that are willing to give you a personal loan proof of income submitted.

How Do I Know If A Personal Loan is Right for Me?

You are the only one who can decide this for you. No one else can make this decision for you. There are some things to consider before you decide if you want to apply for a personal loan. The most important thing to determine is can you repay the loan? Do you have enough extra money every month to pay  the loan amount? If the answer is no, stop here.

A personal loan is not right for you. Obtaining a loan that you cannot pay back only puts you in a worse financial position. You must remember that while you get one lump sum from the lender, you still must pay it back. If you are not sure if you have enough money to pay back the loan, you can use a loan calculator.

A loan calculator helps you determine how much you can pay. You enter how much money you earn in income per month. Then you enter in all your debts and expenses. The calculator determines how much money you have at the end of each month to pay back a loan. If you do not have enough money to cover the loan, stop again. Do not proceed with the loan. Missing payments or making late payments decreases your credit score and puts you in a worse place.

Can I Get a Personal Loan Online?

In short, yes, you can get a personal loan online. There are some things of which you should be aware when considering a loan online. There are some online lenders that are not reputable and are looking for people to scam. They probably figure that people who are in a desperate situation are the easiest to scam. Be careful of online lenders. Make sure that you do your homework when searching for an online lender. Make sure you know everything you can about them. An upside to online lenders is a quick turnaround time. You can find some of the best lenders below, and if you want to get offers from those who may be willing to give you a loan, fill out this form:


You usually get a decision in 24 hours and then the money is in your bank account in less than 24 hours. They still require personal loan proof of income. However, online lenders save you from having to go into a bank and wait for someone to be available. The application process tends to take less time because they are shorter to fill out. Be aware that there is a down side to online lenders. Typically, the interest rate with an online lender is higher than many other lenders. Usually online lenders cater to individuals that have less than perfect credit.

What Fees Are Associated with Personal Loans?

5 Personal Loan Fees to Know: Borrow Smarter

There are always fees associated with personal loans. Before you sign the contract for a loan, be sure to read the fine print and understand what you are getting yourself into. Keep in mind no matter what type of loan you obtain, you must provide personal loan proof of income. Some of the fees you can expect when it comes to a loan are application fees.

This fee covers the cost of fees for running your credit. These fees typically are nominal but if you have more than one application, the fees add up quickly. If you are not approved for the loan, you do not get that money back. If you can, find a lender that does not charge an application fee.

Administrative fees cover the cost of processing the application for your loan. There are lenders that do not charge administrative fees, so you should find one. Another fee that you should be aware of is an origination fee. This fee combines application and administration fees together in one sum. It usually adds in a fee that is subtracted from the payout amount.

This way, you do not have to pay a separate fee out of your pocket. Some lenders have a prepayment penalty. This means that if you pay off your loan early, you have to pay a fee. Many lenders do not have this fee, so be sure to research any fees that your lender has with your loan. No matter what type of fees the lender has, you still must provide personal loan proof of income.

Conclusion

When you find yourself in a position when you need a loan because you are facing some type of financial hardship, you must consider some things. First, you must always have your paperwork in order and be ready to present personal loan proof of income. Then you must consider if a personal loan is really right for you. If you are not able to pay back the loan, you should not obtain a loan. You put yourself in a worse financial position if you do not pay back your loan. Missing or making late payments decreases your credit score.

There are some things you should do if your credit is bad. You should pay off as much of your debt as you can to increase your credit score. One way to be able to pay off your debt is to create a budget for yourself. When you create a budget, you can remove all of your unnecessary expenses.

Once you list out all of your expenses, you can see what items you paying for that you no longer need. If you have gym membership that you have not used in a year, cancel it. You have magazines or subscriptions that you no longer use, cancel them. Once you create a budget for yourself, be sure to stick to it. The best way for you to be debt free is to work hard at reducing your debt and improving your debt to income ratio.

When looking for a lender, read all of the fine print so you know exactly what you are getting with your loan. Make sure you know about the fees that the lender charges before signing a contract. Make sure you know all the documents you have to provide to the lender, including personal loan proof of income. If you opt for an online lender, make sure it is a reputable one and not someone looking to scam you during an already stressful time.

Check your credit score and get your credit report. This empowers you to know the data with which the lenders are using. When you have this information, it can help you make better decisions about your loan options. Maybe you will decide now is not the best time to obtain a loan. Maybe you will decide to pay off more of your debt. No matter what you choose, make sure it is the best option for you and will not hurt you in the long run.

A Guide to Personal Loans in California: Loans 411

A Guide to Personal Loans in California

If you have found yourself in need of personal loans in California, but do not fully understand them, do not fret. We have you covered. In this article, we will talk about personal loans, how they can be used, how you can find them, and even how to prevent needing them in the future.

What are Personal Loans and Personal Installment Loans?

Personal loans California residents can get are really just plain and simple loans. You borrow money from someone, be it a friend or a financial institution, it is a personal loan. These can go anywhere from a few hundred to tens of thousands of dollars. Generally, though, they average between $500 and $1,500.

A personal installment loan is a type of personal loan. You borrow money from a lender and pay it back in monthly installments. In my humble opinion, personal installment loans are the best type of loan you can get. With many other types of loans, you get short repayment terms and high interest rates. Personal installment loans offer some of the longest repayment periods- months or years- and much lower interest rates- as low as 6%. In short, they are much less stressful to me because you do not have to rush to pay them off. If you need a loan, I would suggest looking for a personal installment loan before applying for others.

Before applying for personal loans in California one needs to know the pros and cons:

Pros:

-You can use them to pay for things you need now that you cannot otherwise pay, like medical expenses or moving expenses.

-If you make timely payments, you can improve your credit score.

-Timely payments can also make you eligible for larger loans when you are making a larger purchase, i.e. a vehicle.

Cons:

-This may seem like common knowledge, but I have actually known quite a few people that did not understand interest means paying back more than you borrow. If you were unaware of that, you know now.

-Missing payments can completely destroy your credit. It can also mean court dates, being sued, losing property, or more. If you borrow money, you need to repay it on time to prevent any additional issues.

If you are aware of this pros and cons, you can easily weigh your options and see if a personal loan is for you. But you also need to make sure that if you decide to get a loan, you do so with a reputable lender. As always, Loanry is here to help. Take a look at the list below, enter your information and you may get offers from lenders you qualify for:


 

The Different Types of Personal Installments Loans

There are two basic types of personal loans: secured and unsecured. Let’s break them down:

Secured:

A secured personal loan is one that requires some type of collateral. That may be a piece of property, like a car, a home, or even investments.Basically, you temporarily give your lender ownership rights to that collateral until you have fulfilled your agreement. This collateral benefits the lender because if you do not pay your loan, they can take possession of your property. They can then sell it to get their money back.

It is also beneficial to the borrower because putting collateral up can help you get approved and possibly even get approved for more. The downside is that until you pay off the loan, you can do nothing with that property. For example, if you used a vehicle for collateral but would like to sell it, you will have to wait until you repay your loan and own it again. It is also important to note that if you do not repay your loan, the lender has every legal right to your collateral. So unless you don’t mind losing it, be sure to pay your loan as agreed.

Unsecured:

An unsecured loan is one that does not require any collateral. The lender basically loans you the money just on your promise to repay the loan. As the lender is taking a greater risk, these are harder to get approved for and you might not get approved for a large amount. The higher the risk, the tougher the application and approval process will be.

If you are thinking that you will not lose anything if you do not pay back an unsecured loan, think again. Though you are not putting up any collateral with these, the lender can still pursue legal action. The result of that could mean you losing even more- and paying more than your original loan. And it can affect your credit. The bottom line is that you should be sure to pay back an unsecured loan, as well.

What Can I Use a Personal Loan for?

You can use personal loans for many reasons. Vacations, bills, debt consolidation, moving, vehicles, real estate, medical bills, even shopping sprees can be covered by personal loans. Having said that, here is a word of warning: being irresponsible with a personal loan is going to get you into trouble.

Let’s take that shopping spree, for example. Taking out personal loans in California just because Hollister is having a huge sale, or because you see an expensive pair of shoes you want is probably not a good idea. On the other hand, let’s say you are starting a new job that requires a professional wardrobe. You check your closet and find nothing but skinny jeans, the outfit that you keep for funerals, hoodies, and tank tops. Obviously, this is not going to cut it at your new job. If you need clothes in a situation like this and will not have any money until you get your first check, it is probably okay to get a personal loan. Well, as long as you have already been hired.

Do you see the difference? Shopping sprees for the fun of it are not a bad thing, but that is kind of an irresponsible thing to get into debt over. Instead, save up for a while, sell your old clothes, and then treat yourself to a guilt-free shopping spree. However, if the shopping spree is an investment into your future, it is not so irresponsible. The key is to simply think through the reason for the loan first and determine if it is really necessary.

How Can I Qualify for a Personal Installment Loan?

Qualifying for personal loans in California is the same as anywhere else. Lenders will usually check your credit score and/or report. Some will go no further if your credit is not good. However, there are some that give bad credit a chance, depending on other things like income and references. What the lender requires often varies from lender to lender, but you can generally expect the aforementioned items.

Where Can I Find a Personal Installment Loan?

California Cash For When You Need Money Now

Ready to find personal loans in California? It is easier than you think. If you prefer in-person applications, you can apply through your local banks, credit unions, and other financial institutions. For a list of personal loans in your area, simply Google “personal loans California”.

A much simpler way, however, is to apply for secured and unsecured personal loans online. Loanry is available to help you find a lender who offers personal loans in California to residents. If you are presented with a loan offer, be sure that you shop loan rates between them before you choose.

Wise Steps to Take After Getting Personal Loans in California:

  • Read your loan agreement. Now, read it again. You need to know exactly what you signed up for. You should have already read it before signing it, but read it again anyway.
  • If you have any questions, ask them, even if you have already signed.
  • Mark your payment dates in your calendar or planner. Do not miss a payment because you do not know the date.
  • If, for any reason, you will be late making your payment, call your lender immediately. They may be able to help you and keep it off of your credit. Even if they cannot, trust me when I say it is much less frustrating for you to call them than it is to have them calling your phone until you finally decide to answer.
  • This last step is simple: repay the loan.

What Can I Do to Prevent Needing a Personal Installment Loan?

There are times in our lives that a loan simply cannot be avoided, and that’s okay. Needing help is not a weakness- it is a human characteristic. Regardless if the loan is to start a business or it is to pay your electric bill does not matter. When it is needed, it is needed- bottom line. And sometimes, this need comes out of nowhere or in amounts so large that we cannot handle on our own at that time.

Then, there are times that you can completely avoid the need for a loan, but it requires diligence, will power, and a great amount of responsibility. And it needs to happen consistently, not just when you are already in trouble. In fact, by that time it is too late. Following these steps year round can help you slide some cash away for a rainy day:

The Dreaded “B” Word

That’s right- budget. If you want to get anywhere in life, you need a plan. A budget is a plan for reaching your financial goals and keeping your head way above water. It is about telling your money where to go instead of the other way around. By being clear about what you are bringing in and what is going out, you can easily see if you need to make more or you need to cut down some.

Here is a big point though: you should give every single cent a home before it comes in. The home you give it is up to you, but it all needs a home. What do I mean? You likely already set aside your electric bill money, your grocery money, and so on. (If you don’t, you should really start.) But what do you do if there is anything left? Letting the remainder of your check just fall to random expenses is not going to help your finances, at all.

Let me break down what I mean. Below is an example of how one might budget a $1,000 check:

Bills:

Power Bill-     $200

Car Insurance- $80

Water/Trash-   $70

Fuel-                 $100

Groceries-        $200

Phone-              $100

Clothes-           $100

Movie Night-      $60

Before we move on, understand that all of these numbers are fictitious. Your bills may not look a thing like that, but you can simply plug the numbers into your budget. Also, notice that I added clothes and movie night to the list. Your budget can consist of anything that is important to you. You do not have to leave out the fun- you just need to budget it in.

Now, if you add these numbers up, you will have a total of $910. With a $1,000 check, this means you will have $90. What would you do with it? There are a lot of answers to this question, all preferential. Regardless of the answer, it needs to be added to the budget. If you plan on saving it for vacation, add it to your list. Even if you plan on blowing it on pizza and beer, put it in your budget. Obviously, the smart thing would be to save it, but you are free to do what you wish. Just make a plan for it all.

Make Saving a Lifestyle

Saving does not have to be event-related. It is something you can do every day. Saving really is a mindset. Understand, though, that saving

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does not mean living in as if you are one step from being homeless. It simply means prioritizing where your money goes. If you value date night with your spouse every Friday night, take your lunch to work with you instead of eating fast food. If paying for your child’s karate lessons every month is a top priority, you might cook more every week. You can save while enjoying your life. You just have to decide what you really want to enjoy and what really does not matter.

Stop Waiting Until the Last Minute

One thing I absolutely despise is shopping at the last minute. If I know that I need it, I will do everything in my power to get it early. That prevents me from having to fight crowds and pay inflated prices. Here are some of my tips for shopping early:

-Christmas:

Let’s be honest, Christmas comes every year, on the same exact date. It does not change. It will be here December 25th of this year and every single year. That is common knowledge, so I have to wonder why people act like it surprises them every year. They fit all of their shopping into a matter of weeks- maybe a month or two. Then, they run around like chickens with their heads cut off possibly having panic attacks.

Even worse, with everyone running around like this, there is an intense tension between all shoppers. They get rude and impatient with one another- which, you know, is totally what the season is all about. The solution- start at the beginning of the year. Have you ever walked into your local retailer two days after Christmas and see an item you paid $100 for knocked down to $50 or less? Yes, it can be frustrating, but you can also use it to your advantage. Start shopping ahead with those sales. Check the clearance aisles all year long. Put $20 up every week so you are ready when you find a good sale. It’s not that you will have nothing to buy around Christmas time, but shopping early can help you make your Christmas budget.

-“Back to School” and Halloween:

These holidays are very much the same. You may not know everything your kids will need the next year, but things like notebook paper, pens, pencils, and other common items are on pretty much every list. About a week after the back to school sales, you can find these items at a fraction of the cost. The same is true with backpacks and even Halloween costumes.

Those are just a few tips for you to save on Halloween and Back to School. I could go on about this for hours, but I digress. If you really think things through, you will find many ways to save.

Conclusion

When searching for personal loans in California, do so with as much diligence as you would pick a pediatrician for your baby- not that the loan is as important as your baby. It just needs to be taken seriously. It can be an overwhelming process to find the loan you need. Let Loanry help you find a lender that suits your situation.