A personal loan is often a forgotten option when someone is looking to borrow funds. People think of drawing from their savings, putting purchases on their credit cards, and even dipping into their 401(k)s to come up with needed money sometimes. However, a personal loan provides an alternative. And if applied for under the right circumstances, could ultimately save the borrower money down the road.
Here are six times you should consider personal loans in Oregon.
1. Pay Down Credit Card Debt Faster
Credit cards are offered at a wide range of interest rates. It’s not uncommon to see rates as high as 19 percent when opening a new account. While this is an excellent tool to help build up your credit score when monthly bills are paid on time, it can also put you into debt with quickly accruing interest. In this situation a monthly bill may only just cover the interest that accrued, while barely touching the balance, meaning it will take the borrower a long time to pay off the credit card in its entirety.
However, what if you could transfer your balance to a lower interest rate?
In fact, you can do just that. Simply apply for a personal loan, which could have an interest rate as low as half that seen on credit cards and pay off the debt with the loan. Then pay down the loan instead.
This easy process will have you out of debt faster and on your way to better financial health.
2. Pay Down Student Loans
If you have federal student loans a personal loan is not likely your best solution, as it eliminates options like income-based repayment, and the interest is probably lower than what you’ll find with a personal loan.
However, if you’re not having luck with refinancing or just want to seek out alternatives, this could be a good option for some graduates who have high-interest private student loans.
It’s hard to imagine that student loan rates can climb that high, but with variable interest in the private market, it’s not unheard of.
If you’re looking to pay down your private student loans faster and with the least amount of interest, consider personal loans in Oregon.
3. Invest in Your Business
Many small business loans are secured. This means that collateral and assets (like your home) are on the table to reduce the risk of the financial institution that provides that loan, should you not be able to pay it back.
As an entrepreneur, a small business loan is likely your first instinct to help grow your company, but if you’re concerned about a secured loan, consider a personal loan instead.
Most personal loans in Oregon, like the ones offered at Central Willamette Credit Union, are unsecured. To protect it, the credit union will instead up the interest rates and look for candidates who have good credit scores before approval. However, these terms may be more favorable to you. CWCU will approve up to a $25,000 personal loan, and this may be enough to reach your goals. It’s worth considering when looking at viable options for your growing business.
4. Take Educational Courses
Technology is changing by the moment, and this is impacting jobs. It’s impossible to go into a job today and be unwilling to continue learning as products, software, communication devices are evolving so rapidly. Employees need to undergo regular training just to keep up.
However, if you’re looking to take your career to the next level or want to get ahead of the curve, then you’ll need to invest in yourself as well.
While dipping into your savings is the best financial option, if that’s out of the question, then don’t just swipe that credit card and pay high interest for that few-thousand-dollar course. Secure a personal loan instead.
5. Home Improvement Projects
It’s not inexpensive to remodel your bathroom or kitchen. However, you can only wait so long before you end up spending more repairing appliances you can no longer stand to look at than actually investing in an updated look.
Most people don’t just have $25,000 lying around. Instead, they dip into their savings, even if it’s earmarked for retirement. Don’t follow this trend. Let those funds accrue interest and apply for a personal loan to finance this project.
It’ll be less expensive than charging your credit card, and you won’t have to worry about fees related to early retirement withdrawal, as well as diminished funds in that account when you need it most.
6. Emergencies
While you might not be able to save $25,000 for a home renovation, ideally you could save at least some before tackling that project, as you knew that day would come.
Unfortunately, sometimes things occur when you least expect and when you are least prepared. In these moments many people jump to their credit card, as it’s just sitting in their wallets and an easy, immediate option. However, a personal loan can be a great alternative to fast cash.
Did your water heater break? Do you need a new transmission for your car? Did a tree fall on your home and you’re fighting with the insurance company on who is going to pay for the damage but you need a fix today? Each of these instances is when a personal loan is an ideal solution to your problem at hand.
Think of personal loans as the quiet middleman. Cash on hand or savings should ideally be your go-to, as you’ll never pay any interest or fees. Credit cards should be charged, but then immediately paid off to avoid high interest fees. Personal loans fit snuggly between the two. It’s the solution for when you need funds that you don’t have on hand yet but don’t want to be paying high interest fees that will have you feeling like you’ll never eliminate the principal balance.
Are personal loans in Oregon the right solution for you? Reach out to our team today to discuss all your options. We’ll lead you down the path to your best financial solution.