When you need a little extra cash, there are several things you might try. However, it’s important to remember that you can do more than borrow from friends and family or use credit cards. Personal loans are a viable option, and in many cases, they can improve your finances over time.
Read more to learn about personal loans and how they can positively impact your financial future.
What Is a Personal Loan?
A personal loan is any small loan provided directly to the consumer for no specific purpose. A mortgage pays for a home. Auto loans pay for vehicles. However, personal loans can pay for anything you like, and most lenders don’t ask you what the loan is for. Even if they do, you can take out a loan to pay for:
- Unexpected expenses
- School expenses
- Medical bills
Who Needs a Personal Loan?
Everyone can use a personal loan in a time of financial distress. You don’t need to have a certain type of job or live a certain lifestyle to apply for or use a personal loan.
A personal loan should be one of the first things you consider when you have extra expenses to cover. These loans are especially helpful when they come from a platform that makes the application and underwriting process as simple as possible.
Benefits of a Personal Loan
Personal loans help you pay for unexpected or extra expenses as well as provide you with a range of benefits you will truly enjoy. Remember, this is not a mortgage, and it is certainly not a payday loan.
You are advised to avoid predatory lenders at all times, especially when they charge exorbitant rates, add extra fees and make it difficult to repay the loan in a timely manner.
Personal loans offered by advanced online platforms make life easier with:
- Online applications
- Low rates
- No early repayment or origination fees
Plus, personal loans meant for borrowers with low, no or bad credit also help you re-enter the market when you would otherwise have no opportunity to borrow the cash you need.
In the best cases, you can take out a credit-builder loan that helps you report to the credit bureau routinely, teaches you more about your credit and saves money.
Drawbacks of a Personal Loan
A personal loan is still a loan you must be prepared to pay off. This is the reality of the situation, and you should consider how you will repay the loan before diving in. If you have issues with repayment, contact the lender for assistance.
Some personal loans look good on paper, but they can pull you into bad rates, short terms and extra fees. Review all the information before signing off on the loan. If the lender cannot provide you with the information you need, you should look elsewhere.
MoneyLion (NYSE: LM) is a financial platform that provides its customers with a level of service and support that is unprecedented in the industry. MoneyLion ensures that the “99% feel 100%” about their finances with tools like:
- Mobile banking
- Cashback rewards
- No hidden fees
- Financial calculators
- Buy-now, pay-later options
- Credit-builder loans
- Investment accounts
- Crypto accounts
- Cash advances
Get a Personal Loan Today
Knowing what you know now, you can get a personal loan and positively impact your finances. Learning more about your money and studying investments with Benzinga makes it much easier to achieve financial freedom in the future.
Frequently Asked Questions
Which bank is best for personal loans?
Digital financial platforms like MoneyLion offer the best personal loans because they do not require the credit checks and underwriting you see with traditional banks. At times, a personal line of credit that functions more like a credit card may be helpful.
What is the easiest loan to get approved for?
The easiest loans to obtain are generally cash advances and personal loans from your current bank or preferred financial platform. For example, if you use MoneyLion, you can get cash advances and Credit Builder Plus loans much more easily.