Every person has some financial needs that need to be met over time. You could be needing some money to pay for your college. You recently met with an accident and need money to pay for the medical bills. You need money to do some home improvement. The following are 6 advantages of applying for personal loans online.
1. Low-Interest Rate
Online personal loans have low-interest rates that start from 5%-6% APR. This rate is much lower than the regular APR of credit cards which is around 10%. Many credit cards have zero-interest introductory offers that can last for 12 -21 months. However, the rates increase up to 10 – 20% after the introductory offer ends. With personal loans, the interest rate stays the same throughout the loan term. Having a good credit score will enable you to take advantage of the low interest rate. Some banks will give you a discount if you use other products.
2. Consolidate Your Debt
You can use online personal loans to consolidate your debt. By consolidating your debt, all your loans will be combined into a single loan so that you only make a single payment. You can use your personal loan to consolidate the student loan and credit card debts. When you consolidate your loan, you are also paying a lower interest rate. It enables you to pay off your debt faster and become debt-free. Visit loan moz.
3. Decent Loan Amount
Personal loans offer a decent amount from $1,000 – $30,000. Some loans like SoFi can offer an amount of up to $100,000. In the application, you can specify the amount of loan you want to request. There is no guarantee that the amount of loan you requested will be approved. The amount you get approved can depend on your credit score and ability to pay back.
4. Does Not Require a Collateral
You don’t have to put in any collateral when you sign up for the unsecured personal loan online. Collateral is an asset like a car or house that you can use as a security deposit to help you get qualified for a loan. When you put in collateral, the lender will be happier to extend the loan. The collateral can be confiscated to compensate for the amount you did not payback. For example, if you use your car as collateral, the lender can take ownership of the car and sell it.
5. Have a Predictable Repayment Schedule
Online personal loans have a predictable repayment schedule. Once you get approved, it will let you know how much you need to pay back every month, the number of monthly repayments, and the total interest amount. It allows you to plan for the payment of the loan to ensure that you meet the deadline every month.
6. Option to Choose Your Own Repayment Term
Personal loans offer longer repayment terms from 2 – 7 years. The longer the term of the loan, the lower the monthly payment. This is suitable for borrowers who can only afford to pay a low amount every month. If you can afford it, you should choose the shorter repayment term and pay off your loan fast. You need to keep in mind that a longer repayment term means lower monthly payment but you are also paying more interest over time.