Image source: emmastevensaccountancy.co.uk

Have you found yourself in a financial situation that you simply cannot get out of no matter how much you work or how much you borrow from your friends? Your debts might seem like they are endless and you do not feel like you should continue annoying your family or your friends to give you more cash. That kind of thinking is the first step to help you get out of such a situation. Your next step would be to consider getting a loan to help you with your problems.

While the idea of using such a service might seem like a very scary idea, a lot of people who are financially stable constantly use this kind of service. People use loans to buy that beautiful car they have been eyeing for years, to purchase homes, go on amazing vacations and even for everyday purchases.

This shows just how useful and safe loans can be and those people that are so biased towards this kind of service are usually the ones who are not very financially responsible.

Believe it or not, personal loans have become very popular in the last couple of years, whether it is a secured or unsecured one.

This happens because all the other alternatives are not as safe and appealing such as credit cards and payday loans while personal ones have multiple advantages that can improve your financial situation instead of digging you even deeper in your hole.

So, if you are considering whether borrow of money will help you, here are some of the reasons why you should go for it.

Higher limits than a Credit Card

source: iab.org.uk

According to the latest trends, the average higher limit of credit cards for most banks was somewhere under $15,000. And this offer was for people who had a premium membership or a loyal membership which means that most people have a limit that is under $10,000. This certainly is not enough which is why many people consider the option of getting multiple credit cards from different banks so they can have a higher limit.

Unfortunately, you simply cannot get rid of all of your debts and get out of your bad financial situation which means you will need a solution that will offer you a much higher limit. Your choices come down to either get a “very premium” credit card from your favorite bank which might cost you thousands of dollars with a limit of about 40k to 50k or get yourself a personal loan.

Depending on which company’s services you have decided to use, the limit of their borrowing will vary.

Most people will manage to get at least a $20,000 borrow at any company while other companies will offer you a loan up to $100,000 if you have the right documents and credit score. Recent research has shown that more and more people are completely switching to the “loan lifestyle” instead of using credit cards.

Much lower interest rates

source: imagup.com

Another way you can help yourself by borrowing money is with a much lower interest rate. You might have taken a brand new credit card and have paid off all of your debts regarding your mortgage or your brand new car, but you will soon realize that you are losing a lot of money through the bank’s interest rates.

Usually, banks do not ask you a lot of questions when you first apply for a credit card, but they will push very high-interest rates which may cost you a lot of money in the future.

So, if you want to ensure that you completely fix your finances then you should definitely get a loan as they come with a much lower interest rate.

According to a recent study, most personal loan rates start anywhere from 4 and 5 percent and go as high as 8 or 9 percent. This might seem like a high number, but with a regular card, you could see a rate that reaches well over 15%.

In other words, in just a couple of months, you could hundreds or maybe even thousands of dollars. Sure, with more premium contracts with your bank, they would agree to settle at a lower rate, but they will not go lower than 10%, so you will still be losing a lot more money. Click here if you want to compare rates between loans and credit cards.

Much easier to plan and manage

source: parysgazette.co.za

What do you think is easier to handle? Having multiple credit cards from several banks who come with a bunch of different interest rates or one big lump sum that will be provided to you by a loan company?

You will not have to worry about multiple due dates, you won’t have to calculate the interest rates, you won’t have to worry about the limits on your cards, you just take the lump sum and you can do anything with it. Sure, there are still due dates and there is an interest rate, but it will be much easier to manage that one rate than think about multiple at once.

Loan companies are much more open about their payments

source: badcredit.org

When you go to a bank and get yourself a brand new credit card, you sign a bunch of documents and that is it. You do not receive any indication, any notes, nor does anyone tell you about how much your yearly or monthly payments will cost. They do not even tell you how much you will pay in interest at the end of the contract.

Loan companies like LoanMart do the complete opposite. Once you are approved, the company will tell you everything you need to know about exactly how much the yearly or monthly cost will be, how many years or months you will need to be repaying and the total amount of money you would repay at the end of your payments.

So, why should you spend time worrying and calculating whether you will have enough for your next credit card payment when you can just get a lump sum and have all the information you need right at the tip of your fingers.

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