Personal loans can be the best option if you are in need of cash to support a specific purpose. In recent years, more than 20 million people have taken out personal loans, so these loans have become popular.
As a type of installment loan, personal loans are taken out as a specific amount of money that must be paid back with interest. Typically, the monthly payments must be paid within 12 to 84 months, which is quite the range.
Once the amount of the loan, including the interest, has been paid in full, the account will close.
The loan amount will vary from lender to lender, but the general range is from $1,500 up to $100,000. Because these loans are based on credit, the amount of loan you qualify for will vary depending on your credit score.
Generally, it’s not hard to get a personal loan. However, personal loans with low interest rates and lenient credit score requirements are harder to come by. For example, an unsecured personal loan will often need a credit score of over 660. Further, some loans require a credit score of over 700.
For those who have poor credit scores, obtaining an instant loan is more difficult. If you have poor credit and need a personal loan, you could run into the problem of only receiving quotes for loans that have incredibly high-interest rates. Plus, if you don’t have much or any income, getting a personal loan is next to impossible.
Yet, a secured personal loan is much easier to be approved for. Because the collateral that you provide decreases the risk on the lender’s end, even someone with bad credit can be approved for a personal loan.
To apply for a quick loan, you don’t need much. In general, you will need proof of identity (driver’s license, state-issued ID, passport, birth certificate, military ID, certificate of citizenship, etc.), your credit score, income verification, loan application, collateral, debt-to-income ratio, and income.
Representative example: for a loan of $10,000 with a three year repayment period, an interest rate of 7.99%, a $350 origination fee and an APR of 11.51%, the borrower will receive $9,650 at the time of loan funding and will make 36 monthly payments of $313.32. Assuming all on-time payments, and full performance of all terms and conditions of the loan contract and any discount programs enrolled in included in the APR/interest rate throughout the life of the loan, the borrower will pay a total of $11,279.43