A personal loan is an amount of money that a bank or other type of lender can provide to an individual based on an agreement that the borrower repays the money back in instalments over a set term. Loan repayments are usually a fixed amount paid every month on top of any interest.
There are a variety of reasons as to why someone may take out a personal loan. Here are 6 common reasons for a personal loan:
If you’re looking to buy your next car but don’t quite have the money upfront, you might consider taking out a car loan. This lets you know exactly how much money you have to spend on a new or used car and gives you a fixed monthly rate of repayment so you can budget accordingly.
Your wedding day should be one of the most magical and important moments of your life, and with the average cost of a wedding rising, it’s hardly surprising that couples look to take out a wedding loan to help with the expense. This could help you to cover some or all of the costs of your wedding including the ceremony, reception or other costs like the wedding dress or honeymoon.
Whether you’re looking to update your home with a new kitchen, or create more space with a new extension, home improvements can often be a big expense. If you’re planning a project and you don’t have the savings to complete your grand designs, a home improvement loan could help cover the costs so you can make those much needed home improvements.
If you have various debts and you’re struggling to keep up with the repayments, you may want to consider a debt consolidation loan. This could allow you to combine multiple debts into one manageable single payment. This could make budgeting easier as you’ll know how much you need to pay back each month. Be careful though, depending on the rate and the term (length) of the new loan, it could end up being more expensive so make sure to shop around and do the maths before making a decision.
Taking out a personal loan might be an option if you need to finance a big life change. If you don’t have the savings available for this new large expense, a personal loan may be what you need to help you to make that change.
Many things happen in life that we don’t expect and can’t plan for, so sometimes you may need a personal loan to cover the cost of a large unexpected expense. If you need money for a broken boiler or if your house needs a new roof for example, a personal loan could provide you with financial support when you need it.
There are a number of reasons why a loan application may be rejected. You should bear in mind that different lenders have different requirements and so will have different reasons for accepting or declining an application.
Here are 6 of the most common reasons for a loan rejection:
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As you can see, there are many reasons for taking out a personal loan and if you know you can make the repayments on time, then personal loans can be a real help when you need financial support.
However, when borrowing money, it must be repaid on time with interest on top so you’ll need to make sure you can afford the interest rate and monthly repayments. Before proceeding with taking out a personal loan you should consider how much you need to borrow and can afford and read the terms and conditions carefully.
If you’d like to understand more about personal loans, read our Ultimate Guide to Personal Loans.
We believe in being transparent and fair with everyone that applies for a personal loan with us. When you apply for an instant quote, it won’t impact your credit score and we’ll give you a clear picture of your guaranteed and personalised rate from the start.
ALL LOANS ARE SUBJECT TO STATUS. THE INTEREST RATE OFFERED WILL VARY DEPENDING ON OUR ASSESSMENT OF YOUR FINANCIAL CIRCUMSTANCES AND YOUR CHOSEN LOAN AMOUNT. TERMS AND CONDITIONS APPLY.