Personal loans are anywhere from $100 to $10,000 in most cases. And more people than ever are seeing them as a solution to their money woes.
Some people use personal loans to pay off credit cards while other people have expensive items they want that they can’t afford to pay cash for right now. Whatever you’re using the money for, it can be a good option when you don’t want to get into a financial pinch.
Continue reading this article to learn more about paying off credit cards with personal loans and more.
Getting the Personal Loan
Getting a personal loan isn’t complicated. Many people don’t know they can get a personal loan without anything to secure it like a boat, car, or a house. Here is what you need to do to start the process of getting the loan.
1. Prequalify and Compare
You don’t want a lot of companies to do what is called a hard inquiry on your credit. Having too many hard inquiries will hurt your credit, so getting prequalified beforehand will save you dings on your credit.
You will likely prequalify for multiple offers. See which ones make the most sense for you and which one has the best terms.
2. Fill out the Loan Application & Provide Documents
Even though you are prequalified for the loan, keep in mind that you have to go through the official application and provide documents with proof of income and anything else they ask for.
3. Submit the Application for Approval
Once you have the application filled out and the documents together, it’s time to ask for approval. Most companies are able to give you a yes or a no pretty quickly, so you can know whether you’ll have the money or not.
4. Receive Your Money
Now that you’ve gone through the process, if you’re approved, all you have to do is get your money. Many times people are able to get their money through cashing a check, or you can choose a direct deposit into your bank account. Make sure to find out what options they offer before going through with the process.
Strategy for Paying Down High-Interest Credit Card Debt
When you’re going through the financial planning process, you’ll learn one of the most important parts of getting ahead in life is paying down high-interest credit card debt.
Even if you’re saving money, you’re not getting ahead because you’re paying more money on debt than what you’re earning on your savings. When you start paying down your credit cards, you will begin to get ahead because you’ll stop spending all of your money paying interest.
Using Personal Loans to Pay off Credit Cards
Now you know more about using personal loans to pay off credit cards. Getting rid of high-interest credit cards is a very freeing feeling.
Do you want to learn more about personal finance and similar topics? Keep reading through our site to get the information you need.