Credit card rates are soaring through the roof these days. Because of this, many people are looking for fast personal loans to get the extra help they need. However, because most personal loans people are applying to be unsecured, they may be harder to get. This is because the bank you go through will check your credit score and if it isn’t good enough, you will either be flat out denied or you will be charged with higher interest rates on top of the loan.
You also want to know everything you can about personal loans and how to get one. You should be well educated on the two types as well as what you will have to go through when applying.
Types of Personal Loans
There are two types of personal loans you can apply for which include secured and unsecured. Although secured loans will come with lower interest rates, you will also have to put up something for collateral. This will include your car, your house, or any other type of assets you have that are worth money. This is because if you quit paying on your secured personal loan, the lender will have something to take from you to pay off what you owe.
Unsecured loans, on the other hand, don’t need collateral for you to get one. They are called signature loans and you will be approved with just your signature. However, the problem with this type is that they come with higher interest rates. Another problem with unsecured personal loans is that the lender will only give you a certain amount. So, you will need to carefully think about what type to try for. Essentially, you can get lower interest rates and a higher loan amount with a secured loan but you will also be taking a risk with your house or car that you will have to use as a form of collateral.
Where to Apply
Your next thought during the process of getting fast personal loans is where to apply for one. The best places to try first include your bank, who you already have a relationship with, or a credit union. Your best bet would be to call these guys provide personal loans first and ask them what their interest rates on these types of loans are. If they are too high, then try with a local credit union. However, your bank will most likely be able and willing to help you since there is already a relationship established with them. One way to make sure you will get the best rates is to call around asking other banks and credit unions to compare them with each other.
One thing to keep in mind about rates is to not even apply for any loan until you know the rates. Some lenders may tell you that they can’t tell you what their rates are until you apply. However, you should ask what their usual rates are anyway. The reason for not applying before you know what the interest rates are is because whoever you go through for the loan will check your credit score when you apply. Because of this and because of your credit score, the rates may be different. Not only this, but every time someone checks your credit score, it will go down and this could ruin your chances of getting approved or increase your interest rates. Make sure to ask the lender what they require your credit score be for approval and lower rates.
Lenders will look pretty heavily at your current financial situation as well as your credit score. The loan you apply for and the interest rates you are hit with will actually be mostly based on your situation you are in with other bills you already have. This is why it is so important to not do anything that will mess up your finances or your credit score.
What you Need to do Before Borrowing
Check over your finances with a fine tooth comb. You will need to be sure you are in a good enough situation for a loan. Make sure you shop around for the best interest rates as well to save yourself money over time.
Make sure you carefully read the entire loan agreement as many times as you need to before signing anything.
Be sure to also make every payment on time.