It’s Christmas once again, and chances are you’re using credit cards to pay for your presents. It’s been estimated that Americans will spend about $1,000 or more on presents, food, clothing and travel. That’s a lot of money, especially since many people can’t afford a $400 emergency.
It’s the reason people use credit cards and personal loans to fund their holiday cheer, not realizing the repercussions of their actions. Personal loans have increased in popularity the past four years with many loans being approved during the last quarter of the year.
Should You Get A Holiday Loan?
Holiday loans are fixed interest rate, installment repayment plan loans that begin the moment they are approved and the money distributed. The loan can run from $500 to $5,000 with one to five-year repayment terms. The money can be used for any reason.
These loans can be applied online, and some don’t need a credit check before you are approved. Banks, credit unions and online lenders provide personal loans.
What Should You Keep In Mind About The Personal Loan Offer?
Never accept the first off you are given. Look at the different ones and compare them. Not all loans are the same. There are four things you need to compare – rate, fees, APR and prepayment penalty.
If you want the best rates, your score should be at least 680. Your monthly debt payments should be much less than your monthly income. Too high of a ratio and you won’t be approved for the loan. Be sure you write down how much you’ll be spending before you ask for the loan. You should never borrow more than you have to because you’ll be paying back interest on the entire amount.