Almost everyone needs to apply for at least one loan — and probably many more — at some stage in their lives. Doing so is often a sound financial move as long as the monthly repayment is affordable and fits into a carefully considered budget.
Here’s a look at five top reasons that you may want to apply for a loan today.
When your older car starts showing signs of age, you are liable to find that the costs of owning it are growing too.
It’s possible that when you add up the annual repairs to keep the car running you find they are getting close to the monthly payments you would pay on a new car.
Not only that, but the need for repairs can be sudden and unpredictable. A major part on the car breaks and you are saddled with a large repair bill that can even run into thousands of dollars that you have to come up with immediately or face the prospect of not having a car to drive. In addition, the car is likely steadily losing its value.
In short, you have reached the stage where the car is costing more than it is worth. It might be time to apply for a loan to buy a new car. The car will be reliable.
Depending on the type of warranty you have on a new car, it may ensure that for several years you will not have to pay for any sudden costly repairs that might occur. The monthly payment amount on the loan could be more affordable than you thought it would be.
Your house is usually the most important investment you will ever make. It is important, therefore, that you work to retain its value by repairing parts of the house that are damaged or are unsightly, or modernizing those that are out of date. You should do so before they deteriorate further.
Should your family be outgrowing the house, rather than selling the house and moving elsewhere you might want to consider adding a room, turning an old garage or an uncompleted basement into living space, or adapting your home to meet your changing needs.
You do not have to come up with the cash to improve your home. A personal loan based on the value of your house may help you pay for quality repairs and achieve these aims.
If you have a number of personal loans or other debts that are becoming a strain on your budget, you might want to apply for a debt consolidation loan. A bank loan can help you to pay off the personal loans or other debts and roll them into one new loan.
The loan payment on a debt consolidation loan is likely to be less than the individual loan payments, particularly if some of them are at a higher interest rate.
With house prices rising once more, the chances are good that your property has gained in value in recent years. The difference between your mortgage and the value of the house today represents equity that you might be able to access with a personal loan.
You can use this money for any purpose. As a fun exercise, you could consider home equity loans as wedding loans that enable you or your offspring to hold that dream wedding to remember.
Similarly, think of equity loans as vacation loans. Many people might use such vacation loans to make that dream trip come true. You might want to have fun devising other alternative names for your home equity loan.
Almost all small businesses, no matter how small or how big they are at the outset, need financial help to grow. The amount depends on the nature of the business. Some need more capital than others.
If you are considering growing your business, begin by developing a business plan. In that plan you should
outline how you want to increase the revenues of the company, the services or products that you want to sell, who your customers will be, and how to increase your profit. That plan will help you determine how much money you will need to grow your venture.
It is good to aim a little higher than you might calculate so that you will have money on which to draw should your path to making a greater profit takes a little longer than you had thought.
Armed with that amount, apply for a loan, possibly one backed by the Small Business Administration. Show the bank your business plan, tell them how you are going to make money and whether you have any assets that you can use as collateral for the loan. Soon you will be opening the door to your new venture.
AS YOU START THINKING ABOUT THE NEXT BIG STEP for your family or your business, it’s good to know that there are a range of financial options that may be just what you need to get moving – everything from credit cards and lines of credit to commercial loans and mortgages. Even better, you can count on M&F Bank to clearly explain all of your alternatives, and help you choose the best ones for you.