How do I get a personal loan?

There are many ways to get a personal loan. The greatest number of options for where to go usually belong to those with demonstrably very good to excellent credit. There are fewer options as your credit score goes down. However, even with bad credit, it is possible, although possibly inadvisable, to obtain small loans.

At the top of the list of how to get a personal loan are banks, credit unions, savings and lending institutions called peer-to-peer loans. With very good credit, people can apply to their banks, credit unions or the like and get a decent offer on a personal loan. This usually takes a few days to get approved, but interest rates, particularly at credit unions, can be good. Those looking to get a secured loan at better rates can take a longer route and get an equity line of credit, which is removed from the equity of a home or other property, or they can refinance a home and simultaneously remove some of the equity.

Another option is to join a peer loan group to get a personal loan. This allows borrowers to obtain small loans at very low interest rates. People invest money as lenders or apply for a loan and become part of a network of borrowers or lenders. Some people consider this type of group to be a good investment option. The credit scores required to participate are usually quite high.

If the required loan amount is small, a person can get a personal loan by getting a credit card account with the balance needed to accommodate the personal loan amount. Again, people can get this through a bank, but they can also search online for credit card deals to find the most advantageous. This option will not be available to everyone unless they have excellent credit. People who need much larger loan amounts may not be able to get what they need with a credit card.

Those who do not have an excellent credit history can also consider the credit card option. This is even more available to consumers than getting personal loans from banks or peer-to-peer loans, which can require quite a high credit rating. Alternatively, borrowers can turn to other loan companies that will provide what is considered a "higher risk" loan that carries higher interest rates.

For those who cannot get big enough credit cards or any other type of personal loan, another option is bad credit or payroll loan. These can be available in amounts up to around $1,500 US dollars (USD), but can charge huge fees for originating the loan and during repayment, especially if the loan is in installments. An additional option would be to try to get loans from family or friends, with a clear repayment agreement.

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