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Do You Know Your Loan Options?

Posted in Borrowing Money
August 26th 2014 by

If you need some extra cash, you may know where to go (to us, of course!), but you may not know what your best option is. Do you take out a personal loan? Apply for a credit card? Or do you need a FlexLine of Credit?

We’ll explain these options and talk about the pros and cons that come with each one.

Personal Loans

A personal loan gives you the cash you need in one lump sum. You lock in your rate and the length of the loan, so there will be no surprises when it comes to paying it off.

Here are some things to think about with personal loans:

  • It’s easy to work a personal loan into your budget since you know how much you’ll owe every month and for how long.
  • Personal loans are excellent for major purchases like home repair.
  • Rates may be lower than credit cards and FlexLines.
  • Paying off your loan will have a positive impact on your credit report.

Credit Cards

A credit card gives you access to the cash you need when you need it. Upon approval, you will be given your interest rate and maximum spend limit.

Here’s what you need to think about:

  • Some credit cards offer rewards programs where you earn points for using your card. These points can be redeemed for things like cash, gift cards, televisions, household appliances or even plane tickets.
  • Many credit cards offer extended warranties on purchases.
  • Managing your credit card properly (keeping debt low, paying off promptly) can help your credit score.
  • It’s easy to get in the habit of charging too frequently and carrying a high balance. Making minimum payments can prolong payoff for years.
  • It’s best not to use credit cards for big ticket items that will cause your balance to be close to maximum.

FlexLine of Credit

Another option is opening up a FlexLine of Credit. This mixes some of the features of both credit cards and personal loans. You will have a set credit limit and can draw on that credit whenever you need.

Here’s what to think about:

  • The FlexLine is perfect for emergencies. If you have an upcoming bill due, emergency room visit or are in a place that doesn’t accept credit cards, your FlexLine can help.
  • It’s easy to use. Writing a check, using the ATM or completing a point of sale transaction with your Aspire Debit Card will allow you to access these funds.
  • Having a FlexLine in place allows you to avoid costly overdraft fees.
  • FlexLines are ideal for people who may need a little extra cash now and then, but can pay it off quickly.

If you need more help deciding which product would be best for you, our Loan Experts are happy to help. You can reach them Mon-Fri 9am-6pm and Sat 9am-1pm at 855.MY CU LOAN (855.692.8562).

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