What are the Benefits of Personal Loans?

Posted on May 21, 2018

Personal loans are an ideal solution for your financial needs, thanks to their flexibility and affordability.

Different lending options are available especially if you have average or better credit. The better your credit, the fewer limitations on your personal loan.

Regardless of your unique circumstances, personal loans are often the best route to take for funding life’s anticipated, or unexpected, adventures.

 

7 Benefits of Personal Loans

Here’s a closer look at some of the advantages of personal loans over other types of financing.

1. Debt Consolidation

If you’re struggling with expensive credit card debt, there is no better way than to use a personal loan for debt consolidation.

With debt consolidation, you obtain a new personal loan with a lower interest rate and use the funds to pay off each of your credit cards. The result is a single monthly payment and the ability to pay off your debt much faster.

Additional benefits of debt consolidation include a lower monthly payment and improved credit score.

2.  Financing a Major Purchase

You can use a personal loan for any type of expense you wish. This may include buying a vehicle, making home improvements, or even paying for education expenses.

If you’re financing a major purchase with a personal loan, it’s critical to consider loan terms and rates. For example, if you plan to purchase a high-valued item, such as a car, you may be able to secure a lower rate with a specialized loan.

In another situation, you may find specialized loans are not available. This is when personal loans are ideal because they tend to be significantly less expensive than credit cards.

3. Paying Off Medical Bills

While medical bills typically don’t have interest rates, they can have fees that lead to wage garnishments.

If you’re faced with hefty medical bills, personal loans allow you to get all of your payments caught up. You can then pay them back over time with an affordable monthly payment. As an added bonus, if you were behind on payments, using a personal loan will protect your credit score from negative hits and get the creditors to stop calling.

4. Making Home Improvements

Homeowners may often tap into personal loans to help with major home repairs or renovations.

If you have equity, a home equity loan may be more affordable than a personal loan. Interest rates tend to be lower on equity loans because they are secured to the value of your home.

If you don’t have a significant amount of home equity, personal loans can aide with repairs, updates, additions, and many other investments. If you want that new patio or need to deal with a wet basement, personal loans are an excellent option, and they extend the value of your home, too.

5. Investing in a Dream Vacation

Personal loans don’t isolate needs from wants. So if you’ve been brainstorming how to afford to take your family on a dream vacation, check out personal loans.

Personal loans are less expensive than using credit cards. Additionally, you can budget in advance, so you are only borrowing what you need for the vacation, and no more.

6. Paying College Expenses

If you’re sending a child off to college, you’re well aware of high tuition and other costs. Instead of turning to high-interest credit cards, consider investing in a personal loan.

Regardless of the type of school, location or tuition fees, you can use personal loans to pay for local community college costs, room and board at a private school, even off-campus housing, books and meal plans.

7. Cover Emergency Expenses

Perhaps a smart way to use personal loans is to fund life’s emergencies.

Whether it’s costly unexpected repairs, medical expenses, or too much debt, if you are operating on a cash-only budget, you may be able to use a personal loan to establish an emergency fund to cover these expenses.

 

Flexibility & Benefits of Personal Loans

Hopefully, you’re no longer wondering what you can fund with a personal loan, and ready to take advantage of this flexible and affordable financing option!

You’ll be surprised at how lower interest rates, flexible loan terms, and easy application process make this a convenient investment option for your needs.

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A $15 Convenience fee will be automatically added to your payment amount. Your maximum total payment amount (including the $15 convenience fee) cannot exceed $600. Payments initiated and approved by 3:00pm will be applied to your loan on the same business day. Payments initiated and approved after 3:00pm, or on a day that the credit union is closed (weekends and holidays), will be applied on the next business day. If you have a PFFCU debit card, please log into home banking to make your loan payment.

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Excludes mortgages and home equity lines of credit. A $25 fee is due at set-up for each loan. Loan must have been open for at least 6 months. Past due accounts do not qualify. One skip-a-pay allowed per calendar year (Jan-Dec).

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