Personal loans and personal lines of credit can make life easier and help you meet your goals. You can use them to buy something you need or to pay expenses, like monthly bills, life’s little emergencies, or to combine several debts into one simple, predictable monthly payment.
Both borrowing options are unsecured, so you don’t need collateral, like a car or a house to get approved. Let’s review how these loans are different, to help you see which is best for you.
What is a personal loan?
A personal loan lets you borrow a specific amount and pay it back over a fixed period. Personal loans offer:
- Term and payments: Fixed monthly payments over a specified time period.
- Specific purpose: Loans are often taken for debt consolidation, one-time expenses, or to reach a special goal.
- Predictable interest rate: The rate remains the same throughout the life of the loan.
- Lump sum: You receive the full loan amount upfront after being approved.
What is a personal line of credit?
A personal line of credit offers more flexibility because you can re-access the credit line as you pay down the balance. Your credit line comes with a pre-set credit limit, and you can borrow up to that limit for any purpose, whenever the need arises.
- Revolving credit: As you make payments, funds become available to use again.
- No specific purpose: Can be used for debt consolidation, home improvements, emergencies, and more.
- Variable interest rates: Rates vary with the market. Pay interest only on the amount you borrow, not the full credit limit.
- Easy access to funds: Access funds anytime, as long as you make your payments on time. Funds are typically available in Mobile and Online Banking, at ATMs, in-branch or by phone.
Golden 1 offers competitive rates and low-to-no fees.
As a not-for-profit credit union, Golden 1 can help you save money and improve your financial well-being – with competitive rates on a wide range of loans, including personal loans and lines of credit.
