What is the best thing to say you need a personal loan for?
Common Reasons for Personal Loans
- Debt consolidation.
- Home improvement projects.
- Emergency expenses.
- Vehicle financing.
- Alternative to payday loans.
- Moving costs.
- Large purchases.
- Wedding expenses.
The key is to get as specific as possible. For instance, if you need $700 for a car repair, tell your lender that the money is for that reason. You should also map out a repayment plan, like paying them back $70 a month for the next 10 months.
Your reason for getting a personal loan not only helps determine whether or not you'll be approved, but can have an influence on the type of loan you can get, as well as the loan amount, and even the interest rate.
Each lender has its own application, so the specific requirements may vary. In general, though, you'll need to provide basic personal information, how much you want to borrow and the purpose of the loan. The format of a loan application may also vary by lender.
- 2) What's the most I can borrow? “So, what's the maximum amount I can borrow?” Please don't ask this question. ...
- 5) Which credit card ISN'T maxed out? ...
- 8) I'm getting a cash gift from my parents for the downpayment.
Personal emergency: A personal emergency such as a medical expense, car repair, or home repair can require an individual to ask for financial assistance from family or friends. Business or investment opportunity: A business or investment opportunity may require additional funding to get started or to expand.
Personal loans can be used for almost any expense, including debt consolidation, home improvement projects, large purchases and emergencies. Personal loans may be advertised specific to their use — home improvement loans, travel loans or medical loans — but they function the same way.
- There is an old saying that banks only give money to companies that don't need it. ...
- First, Build a Real Relationship. ...
- Know the Numbers. ...
- Explain How You Made Your Forecasts. ...
- Show How They Get Their Money Back. ...
- Personally Guarantee the Loan.
One common reason you would be declined for a personal loan is a poor credit history. Income and the amount of debt you already have can also be reasons a lender may reject your loan application.
What happens if you get a loan and don't use it?
If you took out an unsecured loan
If you fail to live up to your end of the agreement, it will be reported to the credit bureau and your credit score is likely to take a nosedive. The problem with allowing your credit score to be damaged is that it can take years to rebuild your credit history.
Some of the easiest loans to get approved for if you have bad credit include payday loans, no-credit-check loans, and pawnshop loans. Personal loans with essentially no approval requirements typically charge the highest interest rates and loan fees.
You will need a credit score of 580 or higher to get a $30,000 personal loan in most cases, along with enough income to afford the monthly bill payments. Other common loan requirements include being at least 18 years old, being a U.S. citizen or a permanent resident, and having a valid bank account.
TD Bank is the best bank for personal loans for people with fair credit because it offers unsecured loans (660 credit score required) and secured loans (no minimum credit score stated). People with fair credit or better may be able to qualify for both types of loans, while people with limited or...
- Payday loans. Payday loans are the worst type of loan to get, because they offer very high interest rates and short repayment terms. ...
- Title loans. Title loans are another high-interest loan to avoid due to its high fees and requirement of using your own car for collateral. ...
- Cash advances. ...
- Family loans.
In some cases, a lender might ask for your bank account number to know where to send the loan funds after your application has been approved. Some online lenders may ask you to connect a business bank account to analyze and verify your revenues to see whether you qualify for an online loan.
State your budget and ask about the details of the loan including the down payment, closing fees, APR, whether it's fixed-rate or adjustable, and any other fees. Compare multiple offers and don't sign anything with blank spaces, ballooning rates, or a clause not to sue.
- 1 Be upfront about why you're asking.
- 2 Specify how much money you need.
- 3 Tell them when you need the money.
- 4 Suggest how to send you the money.
- 5 Note when you'll pay them back.
- 6 Put it in writing if you're asking for a large sum.
- Be confident and positive. Walk into the room with confidence and good posture. ...
- Ask questions. ...
- Prove your value. ...
- Start the salary discussion. ...
- Keep it professional. ...
- Use smart negotiation techniques. ...
- Listen and ask questions.
While personal loans may be helpful in several situations, they can also come with high interest rates and major repercussions for your credit score. Even so, the benefits of these loans may outweigh the risks—especially if you qualify for a competitive rate and need quick access to cash.
Can anyone get approved for a personal loan?
Lenders will review your credit history and credit score to determine your creditworthiness and ability to repay the loan. Generally, borrowers with a “good” credit score — 670 or higher — will have the most options for a personal loan. But some lenders may accept credit scores lower than this.
Some lenders will actually cater to those with poor (or no) credit. Upstart Personal Loans, for example, will accept a FICO or Vantage score as low as 600, but they also accept applicants who haven't built up a sufficient credit history yet.
- Check the accuracy of your credit report. ...
- Improve your credit score. ...
- Prequalify before formally applying. ...
- Work on reducing your debt. ...
- Find ways to increase your income. ...
- Don't apply for too much money. ...
- Adding a cosigner or a co-borrower.
The bank will likely look at your credit history as well as your debt-to-income ratio. Since banks have higher criteria for their loans, the approval process can take a bit of time.
- Personal details, including name, address, phone number, date of birth and Social Security number.
- Loan details, including desired loan amount, loan purpose and repayment term.
- Proof of employment and income.
- Information about current debts.