It is not uncommon to run into financial trouble. For some, the problems were caused by the loss of a job. For others, unexpected bills arise, such as vehicle repairs and medical bills. If you are experiencing financial problems, you should look into personal loans. There are several benefits of personal loans that you may not know about.

1 Personal Loans Are Versatile

Personal loans are different from car loans, student loans, and mortgages because the money can be used for anything. Once approved for a personal loan, you can use the money to fix your car, pay your medical bills, and even to finance a dream vacation. You are not limited to what you can spend the money on.

2 Reasonable Interest Rates

Many people try to resolve their financial issues with credit cards. Before you do this, you should consider the interest rate on each one. Today, the average interest rate for a personal loan is 11.88 percent. The average credit card interest rate is 16.04 percent. Therefore, in the end, you would need to repay less money on a personal loan than you would in credit card payments.

3 No Collateral Necessary

Many types of loans require collateral. For example, if you take out a mortgage or a home equity loan, the loan is secured by your house. If you don’t own a house or anything of worth, you won’t be approved for a secured loan. Fortunately, most personal loans are unsecured and require no collateral. This is essential for anyone who doesn’t have anything of value to use for collateral.

4 Plenty of Lenders Offer Personal Loans

There are plenty of lenders that offer personal loans, which makes applying easy. You can go to your bank or credit union to apply for a personal loan. There are also plenty of lenders online, which makes applying for the loan more convenient.

5 You Don’t Need Perfect Credit

Good credit is essential for many types of loans. However, many personal loan lenders will work with borrowers with less than perfect credit. It is essential that you understand that if you have poor credit, you will be paying more in interest.

6 Your Monthly Payments Stay the Same

The great thing about personal loans is that the interest rates are fixed, which means that your monthly payment will always be the same. This is very important if you are living on a budget.

7 Plenty of Repayment Plans To Choose From

A great thing about personal loans is that there are plenty of repayment plans to choose from. Terms range from one year to seven, and most lenders will allow you to choose the repayment plan that works best for you.

8 The Approval Process Is Quick

If you apply for a mortgage or a high equity loan, it can take up to a month to close on the loan. Personal loans are different. If you apply for the loan online, you can often get an answer the next day. This is great if you are really strapped for cash.

If you are struggling financially, you should look into personal loans. There are several advantages of personal loans that you can’t get from other types.