Over the past few years, the number of personal loans issued has risen significantly. During 2013, around 10 million people utilized these loans, with numbers rising to 14 million by the start of 2016. They can be a great way for people to consolidate debt, especially outstanding balances on credit cards.
Here are two reasons why consumers should consider consolidating debt with a personal loan:
1. One perk of a personal loan is that lenders do not use traditional credit scores like banks and credit unions. Consumers whose credit score doesn't represent their repayment capability can benefit from a personal loan. In some cases, lenders might even speak to applicants directly, allowing people to provide a complete financial profile.
2. Another good reason for utilizing a personal loan is that they often have lower interest rates than a lot of credit cards. Refinance loans, for example, can be between 2 and 4 percent lower than the average credit card.
If you are interested in a personal loan, visit our curated list of top lenders.