Personal Loan Payment Calculator
Personal loans are unsecured installment loans that can be used for virtually any purpose - debt consolidation, home improvements, medical expenses, or major purchases. Unlike credit cards, they offer fixed interest rates and predictable monthly payments. Interest rates typically range from 6% to 36% depending on creditworthiness.
Personal loans are ideal for consolidating high-interest credit card debt. If you have good credit, you can often secure a personal loan at a much lower rate than your credit cards charge. This single payment simplifies your finances and can save thousands in interest. However, ensure you address the spending habits that led to debt in the first place.
When comparing personal loan offers, look beyond the interest rate. Consider origination fees (typically 1-8% of loan amount), prepayment penalties, and repayment terms. Some lenders charge high fees that effectively increase your APR. Online lenders often offer competitive rates and quick funding, while credit unions may provide lower rates for members. Always read the fine print and calculate the total cost before committing.
Quick Tips
- Always compare APR, not just interest rates
- Use the Rule of 72 to estimate doubling time
- Extra payments dramatically reduce total interest
Frequently Asked Questions
Personal loans can finance nearly anything: debt consolidation, home improvements, medical bills, weddings, moving expenses, or major purchases. Most lenders don't restrict usage except for illegal activities or education expenses.
Personal loans have fixed interest rates, fixed monthly payments, and set repayment terms. Credit cards have variable rates, revolving balances, and minimum payments. Personal loans are better for large, one-time expenses.
Most lenders require 600+ for approval, though best rates go to 720+. Some lenders work with scores below 600 but charge much higher rates. Check your score before applying.
Initially yes, due to the hard inquiry and new account. However, making on-time payments improves your score over time, and consolidating credit card debt can help by reducing credit utilization.
Personal loans are better for large expenses you'll pay off over time - they have lower rates and fixed payments. Credit cards suit smaller, short-term expenses you can pay off quickly or ongoing purchases.