What is a personal loan?
A personal loan is an unsecured loan you get from a bank or lender. The money received can be spent however the borrower wants. Most personal loans are used for debt relief, emergencies or home improvements.
Where do you get a personal loan?
First off, to get a personal loan you will need to have a good credit rating. Applying for a loan with a poor credit rating will most likely lead to denial. Or if you do find a willing lender with a poor credit score, the interest rate will likely be sky high. Not a good solution if you’re looking to erase debt. But if the loan is for an emergency situation, then you might not have many other options.
Now as to where to get a loan. You can easily find and apply for personal loans right on the internet. Plus with companies like Quicken Loans and Credit9 you can find out if you’re approved in minutes. You can also still apply for personal loans at brick and mortar places too – like credit unions and banks.
Is a personal loan a good idea to get out of debt?
A personal won’t get you out of debt. But it will help you pay off debt faster if you can get a loan with a lower interest rate than your credit cards.
So a personal loan can be a good idea if you’re using it to save money as you work to get out of debt. To use a personal loan successfully as a debt relief option: it’s best to find an interest rate lower than your credit card rates, close or stop using your consolidated credit cards and put as much money toward the loan each month as possible. Of course to do all this it’s important to learn to live frugally and spend less than you earn.