A personal loan is a great option for many health professionals who need money immediately. But which is best for your financial situation, and how long does it take to get approved for a personal loan? These are essential questions you must understand before applying, so here’s what you need to know.
What is a personal loan?
A personal loan is a short-term loan that you can use to cover unexpected expenses or debts. You borrow money from a lender, typically through a bank or credit union, and pay back the loan with interest.
Who can get a personal loan?
Personal loans are available to anyone, regardless of their credit score or debt-to-income ratio. In fact, many banks and credit unions offer loans to people with poor credit ratings because they know they can repay the loan on time.
How much do personal loans cost?
The amount of money you can borrow depends on your credit score, your income, and the terms of the loan you choose. Typical APR rates for personal loans range from 12% to 20%.
What are the different types of loans available?
There are typically three types of personal loans that cater to health professionals:
- Fixed-rate- a personal loan with a fixed interest rate that you can always count on. These are best for health professionals who have a low-risk tolerance with their finances and just want simplicity.
- Variable rate – a personal loan with a variable interest rate that can change over time. These are typically easier loans to get than fixed ones if you have poor credit. It’s good for health professionals betting on lowering interest rates, but the market can turn against you, making the rate higher than if you settled for fixed.
- Secured rate- a personal loan with a fixed interest rate that’s guaranteed (“secured”) by an asset, such as your home or car. Health professionals who are just getting into their field and don’t have a long employment or credit history may want to start with a secured rate to ensure their loan application is approved.
How do you apply for a personal loan?
There are a few different ways to apply for a personal loan:
- Online- many banks and credit unions offer online applications that allow you to submit your application from anywhere.
- By phone- many banks and credit unions still offer phone applications, which allow you to talk to a live representative about your loan options.
- In-person- some banks and credit unions offer in-person loansharking, which allows you to speak with a live representative about your specific loan needs.
How long does it take to get a personal loan?
It usually takes between two and four weeks to receive approval from a traditional bank or credit union. However, there are sometimes faster turnaround times available if you meet specific criteria, such as a high credit score of 725+ or a solid employment history. Some online banks even offer instant approvals for those who meet eligibility requirements.
What are the requirements for getting a personal loan?
There are no standard requirements beyond being able to provide your basic financial information, including your Social Security number, income, and credit score.
To get the most competitive offers, you should have a credit score of at least 725. Scores that are 500 or under may have difficulty getting approved for fixed-rate or variable loans, regardless of how lucrative your niche is in the health industry.
The bottom line
Choosing the right personal loan can help you meet your financial needs while staying healthy. By doing your research, you can find the best personal loan for you and avoid ending up in debt.