We all go through significant events at different times in our life story. Whether it’s the impending birth of your first child, a new home purchase, or deciding to take a once-in-a-lifetime holiday, there are plenty of situations where a personal loan is useful. A loan calculator is used to discover what the monthly cost of repayments will be; that way you’ll know just how affordable it is.
Here a few reasons why a personal loan is helpful at different times in our lives.
1. Giving Your Credit Score a Boost
Whether you choose to look up your credit score with Experian or another credit scoring company, the rating that these agencies provide you shows how you’ve managed money, especially debt. If you’ve never taken out credit before, it is often difficult to do so because you lack a reliable credit score that a lender needs to see. Therefore, taking out a smaller value personal loan and repaying it on time is a useful way of building up a good credit score. A payment history and an improved, validated credit score are useful when needing a larger loan or a home mortgage at a later time.
2. Money to Build a Small Business on the Side
There are plenty of new ways to create additional income by using the internet to make connections and provide a service. The work can be performed in the evening or at the weekend away from your regular job. The type of side hustle will vary and may not closely match what you do during the day. Indeed, avoiding a conflict of interest with your current employer is a good idea for job security while you still need it.
Try using the loan calculator at www.118118money.com/quick-loans/ to determine what the cost of the loan will be. Armed with this information, you can plan your new business’ cash flow, including the cost of repayments, to figure out what’s affordable for you. Based on this, you can decide how much you should borrow and how to use the funds to develop your new business.
3. Get a Deal on a Used Car
The cost of driving in the UK isn’t cheap. Reducing the cost of a car by looking for a quality used one is a very good idea to hold on to your pennies. Make sure that you get a full AA inspection on the vehicle before purchasing it so they can highlight any major mechanical issues that might be a problem later.
Financing a used car is easy enough to do. Some car dealers may want to set you up with their own lenders because they make more from the loan arrangement than they do from the sale of the vehicle. However, these deals are usually poor value for the UK car buyer.
4. Going Private for a Faster Medical Procedure
For anyone who’s ever sat on an NHS waiting list for a medical procedure while enduring much pain, the idea of “going private” is an appealing option. Finding a few thousand pounds to pay for a small system isn’t always so easy. A loan that covers some or all of those medical costs will open the doors to end the pain sooner by getting the problem taken care of quicker. Sidestepping the waiting list is one way to resolve health problems earlier while skipping the additional discomfort caused by excessively long waiting lists.
5. Debt Consolidation
When you have several credit cards and small loans that you’d like to clear, a small personal loan is one way to do that. Taking several difficult to track payments and switching them over to one monthly payment is much easier. It’s far less likely that you’ll forget to make the payment, plus it’s a cinch to plan for too.
Take a look at the cost of a new loan versus the cost of your existing debt obligations. Sometimes, people value the simplicity over the possible cost savings, but other times saving money on the total debt is what matters. It’s more of a personal choice than anything else.
6. Making Minor Home Improvements
While a small loan won’t cover major renovations to a flat or house, they certainly will pay for the cost of making over a living room or a bedroom. A new lick of paint on the walls, a change of furniture, modern lighting fixtures, and a new wooden floor would completely change the look and feel of the living room. It’s best to focus on one or more rooms that get the most use to enjoy the change more often and feel that it was money well spent.
There’s no one right reason to take out a low-value loan. Everyone has a different need for the money, but usually, there’s a purpose in mind and rather than a wild spending spree. Be sure to know why you want to borrow when you use a loan calculator, so you know how much to ask for when you fill out a loan application form.