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How to get a personal loan

Published: Nov. 17, 2021 at 2:00 PM EST
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RICHMOND, Va. (WWBT) - Whether you are borrowing money to adopt, improve your home, or consolidate all your credit cards - a personal loan may be your only option.  Rachel DePompa explains the steps you need to take to secure that loan in this On Your Side Savings Guide.

Most personal loans are unsecured - meaning you don’t need collateral like a car or a house. If this is what you need, there are several steps to secure a loan like this.

Our partners at the financial website Nerdwallet helped us put this list together.

First, check your credit score. A strong score gives you the best chance at not only qualifying but getting a lower interest rate.

A good credit score is 690 or higher, and an excellent score is 720 or higher.

Second, figure out how much to borrow. Don’t borrow more than you need. A larger amount adds more interest and higher monthly payments.

Third, Do your research and compare estimated rates. Figure out how much you’d owe each month, and make sure it fits within your budget.

Next, get pre-qualified if you can. This will give you a sneak peek at the offers you may receive. You will need to be able to answer a few questions: your loan purpose, loan amount, income, and how much you already owe.

Lastly, shop around. Online lenders, banks, and credit unions offer safe unsecured loans. Compare your pre-qualified offers with loan amounts, monthly payments, and interest rates from various lenders to get the best loan offer.

Finally, always read the fine print - so you know exactly what you’ve signed up for.

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