It happens again and again that you need a lot of money, but this is not freely available. If you need a lot of money in the short term, a personal loan may be the right choice for you. However, you should consider certain aspects in order to make a good decision when choosing. In this article you will find out when a personal loan can make sense, whether you have the prerequisites and how to find the right provider.
What is a personal loan anyway?
If you are thinking about borrowing money for a private purpose, it is a personal loan. This is so called because it is aimed at private individuals and is only allocated to them.
A personal loan is usually used to make more expensive purchases, such as buying a car or a house. The repayment of the personal loan is made in monthly installments, which remain the same over the course of the contract. How high these are depends primarily on the loan amount and the chosen term of the loan.
You can get a personal loan not only from local branch banks, but also from online credit providers – such as MoneyGet Credit. The conditions of the respective providers can differ greatly from one another.
In what situations does a loan help?
It often happens that people take out a personal loan to bridge a financial shortage. But in which situations does this actually make sense? When can a personal loan really help?
A personal loan can be an option if you are faced with high costs and do not know how to pay them. Typical cases in which such a loan is often taken out include building a house, buying a property or buying a new car. Even unforeseen expensive repairs or a necessary renovation in your own home can lead to a loan being taken out.
A personal loan can also be used if you want to enable yourself or your family members to have a specific education. This can apply, for example, to stays abroad as part of your studies, which are often associated with high costs. Further training and other types of training often cost a lot of money. It can also be worthwhile to apply for a personal loan.
With a personal loan, you can replace an old loan
Another reason for borrowing may be that you want to redeem existing loans. If a personal loan is found on more favorable terms, the monthly costs (installments) decrease in order to be able to pay off the loan. Therefore, it is often worthwhile to keep your eyes open for a better offer with existing loans. So you can sometimes save high costs when repaying.
It makes less sense to take out a personal loan for purchases that are expensive but that are not absolutely necessary. By law, a consumer loan must not result in the borrower becoming over-indebted. It may be tempting to make a wish come true, even though you have no money at all. However, even if your earnings are low and you take out several such loans for things that you could easily do without, you may fall into the debt trap.
Can you repay the loan regularly?
When considering whether a personal loan could be a good option for you, you should take a particularly critical look at your financial situation.
Successful borrowing depends on not causing you financial difficulties. In any case, you should have the necessary monthly income to enable you to always pay your monthly loan installments on time.
Even if it is purely mathematical: do you have to do without other things? Is it realistic that you still have enough money to live on? You should examine these questions intensively before you decide to take out a personal loan.
Do I get a loan at all? About the requirements for taking out a personal loan
Even if you believe that a personal loan makes sense for you, it may be that you are denied it. Credit institutions scrutinize every applicant and it is always the same aspects that play a decisive role.
Above all, your credit rating has a significant impact on your chances of getting a personal loan. Every lender checks your payment behavior and solvency when you apply for a loan.
You can do this through the Central Office for Credit Information (ZEK). Here potential lenders can obtain important information if you have already taken out one or more loans. If you have not been able to pay debts, the ZEK lender will inform you. Rejected applications for a personal loan are also listed there.
For this reason, you should not make frivolous loan applications. Only make an application if you are certain that you meet the requirements, otherwise this can have a negative impact on future loan applications.
In order for a personal loan to be granted, it is important from the donor’s point of view that the person concerned has sufficient monthly income. Regular expenses also play a role here. In addition, there are often age limits: Older people often find it more difficult to get a loan because there is a greater risk for lenders that the borrower will not be able to fully repay their debts.
Which personal loan is right for me? Selection tips
Before you apply for a personal loan, you should look intensively at various possible lenders and their offers. Only by comparing in detail you can find out which provider is really the best for you.
Many providers advertise with very attractive conditions to attract customers – at second glance or after checking the offer, you quickly realize that the interest rate listed is not realistic.
Sample calculations are usually done at the best possible interest rate – however, you should keep in mind that you may not be granted this low interest rate. How attractive is the offer then? It can still be worthwhile, but you should definitely check it out carefully.
The annual percentage rate is more important than the interest rate. This is more meaningful, because this is where all the annual costs associated with a particular loan offer are reflected. Also pay attention to the conditions in a broader sense: what happens if you are unable to pay an installment? What would be the default interest? And what if you want to repay your loan early? This should be possible without problems and additional costs.
You can apply for a loan from branch banks as well as from pure online lenders, but the conditions for online loans are usually more attractive. This is often related to the lower costs that the online lender has to offer himself.
Term and loan amount – what matters
With every personal loan, you have to ask yourself the following questions: What amount do you need, and in what period do you want or can you repay the money? Here you have to keep in mind that you also have to be able to pay the monthly installments – and not only in the next few months, but depending on the contract, also in a few years. Looking into the future in particular is often difficult, because you do not know whether you will still be able to borrow the available personal loan at favorable conditions from MoneyGet Credit.
With the loan amount, it is recommended that you apply for as much as you absolutely need. But be careful: If you borrow too much, you have worse repayment terms because you have to pay interest – On the other hand, you shouldn’t borrow too little if you would otherwise have to take out another loan in the worst case.
The term also has a significant impact on the conditions of a personal loan. If possible, you should repay your personal loan as soon as possible. Then you will have lower costs overall and you will be debt-free earlier. However, you also need to be financially capable of doing so: a shorter term also means higher monthly installments – so check and calculate your finances carefully before you make this decision.
Take out personal loans on favorable terms from MoneyGet Credit
Regardless of the reasons why you need a personal loan – with the personal loan from MoneyGet Credit you are well advised in every situation. With our online loan, we offer you excellent value for money and flexible repayment terms.
With the MoneyGet Credit personal loan, you can choose your loan amount between USD 1,000 and USD 120,000. You get a low interest rate on your loan, which is between 4.5% and 9.9%. The interest rate is individual and depends on various factors such as payment behavior, liquidity etc. The lower the default risk, the better the interest rate.
With the MoneyGet Credit personal loan, you can repay your debts to us in a minimum of six and a maximum of 84 months. Of course, if you want to pay back the money in full earlier, this is not a problem and there are no additional costs.
If you want, you can also take out installment insurance from MoneyGet Credit Insurance in addition to your loan contract. This will step in for you if you cannot pay the installments due to unintentional unemployment, incapacity for work or incapacity to work (due to illness).
You can easily apply for a personal loan from MoneyGet Credit here online. it only takes a few minutes. Enter your contact details, your desired loan amount and the term of the loan, then we will make you a non-binding offer. Convince yourself of the fair conditions of an MoneyGet Credit personal loan, you can examine and decide on the offer within the 14-day statutory revocation period.