A personal loan is a borrowed sum of money from a bank or other financial institution that you can use for a range of purposes, such as a car, wedding, or even travel. This agreed amount of money must be paid back to your lender over a fixed period of time. For example, if you borrow $10,000 for your wedding, you might be paying this back to your lender in monthly installments for 4 years. The lender will typically charge interest on-top of the borrowed amount of money so that they can both make a profit as a business, and ensure their own security, as lending money to people can be a risk!
How much Can I get for a Personal Loan?
Generally, personal loans sums can vary, but they can be up to $70,000. The interest rate will vary depending on the lender, and the borrower's financial situation. So, if you have a higher credit score and a good credit history, you may not be charged a high interest rate.
Can I get a Loan with a Bad Credit Score?
It’s also important to consider, when applying for a loan, how much you can afford. Assess your budget. Use a loan calculator. A personal loan is a big financial commitment and you don’t want to get in over your head! Loan calculators are handy tools that can help you figure out how much you can afford to borrow, and how much your repayments will likely be per month.
You Must get Pre-Approval
When you apply for a loan, the amount you can borrow will be generally determined by a pre-approval. A pre-approval is the sum of money that the lender has agreed they will lend to you, prior to actually paying out the money. This is a useful step in the process for you, too, because it gives you a ballpark figure of how much you can borrow, so you can plan your budgeting accordingly.
What do you Need for a Personal Loan?
When you apply for a personal loan, the potential lender will need to assess whether you can pay them back consistently. They will look at several factors to confirm this:
- Your income
- Your savings habits
- Your expenses
- Your level of debt
- Your credit score
Compare Personal Loans
To get the best deal possible for your personal loan, be sure to compare, with Money Compare! Comparison is one of the most effective ways to find the cheapest interest rate possible. Our user-friendly platform makes it easy and quick to compare the rates on the market, so that you can make the most informed choice and make savings. Finding the best interest rate possible for your personal loan could unlock hundreds of savings!
You can get a quote, with Money Compare
