Are you on the fence about whether you should apply for a private loan? You’re not alone. Taking out a private loan is a major investment and is something that you need to do properly. It’s important to have a good reason for one and to have a well-defined loan purpose. The following five reasons are among the most common that people use when getting a private loan.
1. Paying Off Debt
According to SuperMoney, American households owe about $10 trillion in mortgage debt alone, which is a major financial burden. Many of these homeowners may turn to private loans to pay off much of this debt because they may find better repayment costs and interest rates with some loans.
2. Starting a New Business
Starting even a small, one-person business is a major financial investment that may require private loans. While business loans may be a better option for many, private loans may work well for those with little credit history or those who need a smaller source of startup capital.
3. Making a Big Purchase
Many people who apply for a private loan do so to buy something big. These purchases may include expansions in a home, boats, trailers, or even private property. A private loan can provide them with the cash that they need for these investments.
People with a bucket-list need to travel may use private loans to get where they want to go. A small private loan of just $3,000 could cover many travel expenses and is something that many people could pay off in less than a year. For those with limited expenses, it provides a strong way to see the world.
5. Medical Bills
People without health insurance may have to take out a private loan to pay these expenses. While they can set up repayment options with their medical company, private loans may cover larger amounts and provide a streamlined payment option that helps make paying a little easier.
These are just some of the many reasons you may need to apply for a private loan. Talk to our lending professionals at GW Private Capital about this process to learn more. Make sure that you also talk with your partner and family to ensure that they understand what to expect with this repayment process and how it may affect them.