A personal loan is money borrowed from a lending institution for a personal expense. They’re typically unsecured, which means they aren't backed by collateral, and the borrower agrees to pay back the total—plus any interest and fees—via regular monthly payments over an agreed-upon time frame. Here are a few of the common reasons people take out personal loans.

Why You May Need a Personal Loan

1. Pay Off Credit Cards

Personal loans allow borrowers to consolidate and pay off their credit card balances. Instead of having multiple card accounts to pay each month, you’ll only have the one monthly loan installment to repay until the debt is satisfied. These installments are always the same amount, which makes it easier to budget, and you don't need to stress about allocating the necessary funds to a variety of card accounts. Also, the interest rate for the loan could be significantly lower than the annual percentage rates of your credit cards.

2. Finance a Project With a High Rate of Return

A personal loan is an excellent funding source for any project that has the potential to pay off handsomely. For example, a home improvement upgrade, like a room addition or swimming pool, will add value to your home when it comes time to sell. You may also want to take out a loan when starting a side business, which can help you attain financial freedom. In both of these examples, the loan gives the borrower a means of recouping their initial investment.

3. Boost Your Credit Score

If you have a financial history of bankruptcy or spending mistakes, a personal loan will repair and rebuild your credit. Future lenders will want to see proof that you can make on-time payments and satisfy a debt in full before they approve you for new lines of credit. With a personal loan, you have the perfect avenue to prove your financial responsibility. Be sure not to pay off the debt early. Honor the terms of the agreement and make timely payments exactly as the contract specifies.

To see if a personal loan is right for you, contact Coastal Finance Company in Savannah, GA. For over 20 years, they’ve been providing installment loans to the area. They’re dedicated to helping you get cash quickly, conveniently, and with zero hassle. Call (912) 303-9979 or visit them online to start the application process.