A personal loan is applied for by an individual for (as the term connotes) personal financial purposes such emergency medical expense or home and car repair expense. One thing nice about personal loan is that you can use it at your discretion unlike a car or home loan where its usage is very specific. There are actually two general feature of the loan that is quite attractive and that is the flexibility of its use and no collateral is needed to secure it.
How much can you get from a Personal Loan?
There is really no exact amount that you can borrow from a personal loan but suffice to say it is enough to cover expenses that would require a sizable amount of funding. However, how much you can borrow is not really the issue but how much you can afford to borrow. Make sure that you have enough surplus (after expenses) to ensure that you will be able to repay the monthly amortization of the loan.
Things that Affects Approval of the Loan
Two general considerations are what concerns lenders before approving a personal loan and these are your credit standing or rating and the consistency of your income. Your chances of landing a loan would be good if your credit score is above average. The higher your score is the better your chances of being approved. Your employment, consistency of your annual income will also be scrutinized. The reason for this is personal loans are not secured, the lenders only source of guarantee that you will be able to handle repayment terms is the consistency and amount of your annual income. To double your chances of getting the right amount of loan that you require, you can convert your application from unsecured to secured loan. Here you would need to put up collateral on the loan. By doing this, you lessen the risk of the lender when they approve your loan. The advantages of unsecured personal loan are it’s easy to apply for, approval is quick and no collateral is required. Its only drawback is the high interests it incurs.