Personal loans are incredibly flexible and can be used to cover a variety of expenses. As the name suggests, you can use the funds to pay for anything that will be of personal benefit to you.
Read on to find out how you could use your personal loan.
Debt Consolidation Personal Loan
It can be difficult to keep track of all of your monthly payments. If you're juggling multiple credit cards and loans, you may be paying high interest. Even worse, missed payments can hurt your credit score.
So, what can you use a personal loan for? Debt consolidation!
A personal loan can be used to help you consolidate your debt and bring all of your balances under one payment umbrella. In just a few steps, you can use a personal loan to consolidate your debt:
- Gather up all balances of your credit cards and loans and figure out the total debt, as well as your total monthly payment.
- Shop around at your local credit union and other financial institutions to see if you can find a personal loan for the amount you need with competitive rates and terms to suit your budget.
- Check that the kind of debt you have is eligible for a balance transfer to the new lender.
- Get pre-approved for your personal loan so you can find out the exact rates you'll get for your credit score.
- Figure out your new monthly payment – if the numbers are better than what you're dealing with now, you could accept the personal loan! Your new lender will consolidate all of your balances and you'll have one simple payment at an affordable interest rate.
Home Improvements Personal Loan
You've already done the hard part: you've jumped through all the hoops it takes to buy your own home. But now you have a mortgage and plenty of bills to pay, and you want to do some home improvements.
So, what can you use a personal loan for? Home improvements!
Unlike a home equity loan or line of credit, you don't need to put your house up as collateral or wait until you've built up enough equity to get a personal loan.
With a personal loan, you could cover:
- Updating your kitchen or bathroom
- Replacing an aging roof
- Building an addition to your home
- Upgrading your patio or improving your garden
All homeowners know that the list of home improvement possibilities is endless!
Tuition Personal Loan
Going to college or pursuing other forms of higher education can be expensive, whether you want to upskill yourself or help a child achieve their goals.
What can you use a personal loan for? Education!
Here are a few popular options when it comes to paying for study-related expenses:
- Get an education loan and use it for tuition, resources, tech, living expenses, or any other study-related cost. This loan has the built-in advantage that you can add to your loan each semester or year.
- Get a Sallie Mae student loan through your local credit union. These loans come with competitive rates and multiple repayment options.
- Get a personal loan and use it for all your study-related expenses. This could be a good option if your educational institution isn't eligible for an education loan or student loan, or you need some extra funds on top of your main loan.
Building Credit
Nobody is born with great credit – you have to build it up over time. So if you haven't got yourself on the financial map yet, a personal loan is a great way to get started.
You know the question: what can you use a personal loan for? Building credit!
- Shop around for a small personal loan with competitive rates and attractive terms.
- Make your monthly payment on time every month until the loan is all paid off.
- Your payments should start having a positive impact on your credit score within six months and possibly sooner.
Personal Line of Credit
Maybe you don't have a specific project in mind right now. Instead, you might want the security of knowing you have some funds available for unforeseen expenses and emergencies.
In this case, you could apply for a personal line of credit rather than a personal loan.
Here are a few instances when a personal line of credit might come in handy:
- Car, home, and appliance repairs
- Health care bills or beauty treatments
- Holiday expenses, such as big family meals and gifts
Still Wondering: What Can You Use a Personal Loan For?
A personal loan is one of the most flexible forms of financing available. You get to choose what you're going to spend the money on, and you get to choose whether you spend it all at once or keep some aside for a rainy day.
Click below to find out what you should have ready before you apply for your personal loan.