Dutton Lending: What Makes a Personal Loan a Smart Move?

Every person strives to be as responsible as they can with their money. That means managing it properly and not spending it on frivolous items for one reason or another. Staying within one’s means is a skill many strive for, but not everyone does a great job at it.

Unfortunately, there comes a time when some need to get some money for a particular situation they find themselves in. That’s where Dutton Lending can come into play.

Whether it’s Dutton Lending or any other personal loan company, the question is pretty simple: when is it wise to take out a personal loan? While every person has a different situation, weighing the pros and cons of a personal loan allows people to make smarter decisions.

The Pros of a Personal Loan

Why is a person looking for a personal loan in the first place? There are many positives to applying for and landing a personal loan. When used correctly, they can help out tremendously.

Flexibility

Personal loans come with very flexible repayment plans for qualified customers. There’s also flexibility with the amount of money taken out in the first place. Many people love this level of flexibility so that they can get started as soon as possible.

Since it is a personal loan, there are no restrictions on the money. Theoretically, a person could use a personal loan to go on a luxurious vacation or spend on designer clothes. That’s not recommended, but the restrictions are lifted compared to other more specific loans.

Competitive Rates

Interest rates are always a central talking point when applying for a loan or credit card. Credit card companies usually have higher interest rates than personal loan companies like Dutton Lending, so it might make more sense to go in this direction.

In related news, some people solely take out a personal loan to repay a credit card that might not have the best interest terms. If the credit card rate is higher, it just makes sense to go this way and save a little bit of money. It also can help speed up the process of repaying a large amount of debt.

Using a personal loan to cover all of the other bills helps with simplicity. Instead of making payments to five or more institutions a month, it’s just a single repayment for the personal loan. Simplifying finance is a huge timesaver.

Zero Collateral Necessary

Everything about a personal loan works towards simplicity. There is no collateral needed for a personal loan since most will only be for a few thousand dollars.

This doesn’t mean that failing to repay the loan doesn’t come without consequences. However, at least a person doesn’t have to worry about losing something valuable like their car or home because it was put up for collateral.

The Cons of a Personal Loan

There are cons to taking a personal loan that people must be aware of to make a smart decision. Most people have a pretty good idea of some of the cons, but others are a little more hidden.

High-Interest Rates, Penalty Fees, and More

It’s already been talked about that personal loan interest rates aren’t the absolute lowest that a person can find. Dutton Lending is just one company that does all it can to keep its interest rates low, but it’s hard to compete with some of the other options out there to be the lowest.

Personal loans usually come with pretty hefty fees if there are any hold-ups with repayment. They are taking a relatively big risk of loaning money out to people, so they tend to use as many fees as possible if there is any delay. Simply putting the repayment schedule on autopay helps keep forgetful people on time.

Uncontrollable Debt

The last thing anybody wants to do is take out a personal loan that they don’t have a plan for. This can lead to even more debt, and it comes to the point that it is uncontrollable.

Getting into a financially strapped situation is never enjoyable. If the interest rate is too much to handle, try to find other solutions first to see if there’s a way out of financial trouble. Cut down as much as possible with frivolous spending, or look for loans from friends and family if possible.

Potential Credit Damage

A personal loan will act the same way as missing a payment or defaulting entirely on other loans. They will report any person to the credit bureaus if they have to, which will put a decent amount of damage on a credit score.

This is all avoidable by staying on top of the repayment plan. The tricky part is that since most people are dealing with a bit of a financial struggle, they are more likely to default on a personal loan.

Is a Personal Loan Ultimately the Right Move?

As long as people weigh the pros and cons, they will likely make the smartest move for them with a loan. Jumping into any situation most likely leads to remorse, so take a little extra time to look at it from a step back.

Anyone who has questions about the lending process can always reach out to companies like Dutton lending. That is one of the most valuable parts of working with Dutton lending. They are more than willing to walk through the loan process as you fill out a loan application. A representative is always a click away at duttonlending.com.