The holiday season can be expensive for many consumers. If you're not financially prepared for the upcoming season, you may want to consider the advantages of taking out a personal loan to cover holiday expenses.
Don't let the holiday season pass you by without experiencing the joy of celebrating and sharing gifts with friends and family. Consider the following six reasons why you should take out a personal loan this holiday season if you could use some extra funds to make the most of it:
You'll have more funds available to buy gifts for friends and family.
The holiday season only comes once a year and quickly passes by. You don't want to miss out on the enjoyment of holiday events and get togethers. A personal loan can provide you with helpful funds that allow you to purchase gifts for friends and family.
Interest rates on personal loans are often much lower than interest rates on credit cards.
A lot of consumers have a habit of maxing out credit cards during the holiday season. This is not a good idea because many credit cards have high interest rates.
While a typical personal loan interest rate will be around 10 percent, credit cards can have interest rates ranging from 15 to 20 percent. You can save a lot in interest if you take out a personal loan for holiday season expenses rather than putting everything on credit cards.
You don't have to secure a personal loan with collateral.
Other types of loan that you may take out for extra holiday cash might require collateral. For example, a title loan requires you to put your vehicle up as collateral in order to be approved.
A personal loan is unsecured and does not risk any of your valuable possessions.
You can use a personal loan on anything you want.
You are not required to use personal loan funds on particular items or at particular stores. On the other hand, a store credit card requires you to make purchases at a particular location.
A personal loan can help you build up your credit.
If your credit history is very brief, a personal loan might be a good option for adding some more positive data to your credit report. As long as you manage to make your payments on time, your credit score will be improved and you may be eligible for approval for higher loans in the future.
You can cover holiday expenses without having to touch your savings
A lot of consumers who are having trouble covering holiday expenses might be tempted to break into their savings. This is always risky. With a personal loan, you can leave your savings untouched and simply pay off the expenses over time. Contact a lender, like US Community Credit Union, for help.