Are Personal Loan Really Bad

[Mika]

You can borrow money for personal reasons like paying for school fees, buying a house or car, or covering medical expenses, renovating house, etc. If you borrow money for things that don't make you money, like buying stuff you don't need, you'll have to pay it back from the money you earn. Getting a personal loan isn't a great idea if you're using it to buy things that won't help you make money. But there are times when it can be really helpful. For example, let's say you borrow $1000 to pay for college. After you graduate, you get a good job and start paying back the loan.

 

[Leah Kelvin]

Personal loans can be dangerous because of their exorbitant interest rates, tendency to accumulate debts, impact on credit ratings and tendency to over-borrow. Nonetheless, they are also helpful for consolidating debts, covering exigent bills or building up a good borrowing record if handled properly. The key factors that one must consider should include carefully examining their financial status, comparing the terms and establishing an affordability of monthly installments prior to acquiring a personal loan. They are not intrinsically evil however warnings and responsible use will help in avoiding financial difficulties and negative outcomes associated with them. It is important to weigh the pros and cons before deciding whether or not to take out a personal loan.