Sterling Effort

Help! I need a personal loan

November 29, 2012 by Jay in Debt with 4 Comments

In an ideal world personal loans would be a work of fiction. A scary monstrous plot device for a horror novel we wouldn’t want to read without the bedroom light on. Some of us are in the position where we have enough cash saved that in the event our car breaks down, home insurance is due, or the kids need a new wardrobe  we aren’t caught short and can afford to cover the costs.

Some of us do require help however. It may be that you’ve just started saving or just recently paid off a large credit card debt and haven’t had time to save before something big hits. In this situation I would first and foremost try and generate the money I needed through alternative methods – either get an evening job, or borrow money off a family member which can save you paying any interest. This is still not always a viable option for everyone and you may find yourself left with no choice but to take out a small personal loan.

I will spare you an in-depth rant into why payday loans are the spawn of Satan, but please take it from me that they should in my opinion  be avoided at all costs. If after all this you are still faced with the harrowing prospect of taking out a personal loan then I would recommend following these steps.

Only borrow a sensible amount which you will be able to PAY BACK
People always fall into the trap of borrowing more than they need. “I need £500 for X, so while I’m getting a loan I may as well borrow £2000 so I can buy myself some cool stuff”. NO. Don’t do this!

Use a loan calculator
personal loan calculator can help you figure out how much you will be able to borrow over a set period of time and how much interest you will pay. They are free to use and widely available on the internet.

Shop around for loans with low interest rates
Don’t just blindly choose the first loan you see; there may be other places which offer better interest rates. Good old Martin Lewis has loads of posts on this, easily found with a quick Google search.

Personal loans can lead to bigger problems than you have when taking them out so only use them if you have exhausted all other options. If you do find yourself in a position where you need to take out a personal loan, make sure you choose the best one you can get with the lowest possible interest rate.

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  1. domNovember 29, 2012 at 6:56 pmReply


    Are your blogs like buses today? ;)



    • JayNovember 30, 2012 at 9:01 amReplyAuthor

      Indeed they are Dom! Blasted public transport…

  2. John@MoneyPrincipleNovember 30, 2012 at 9:32 amReply

    We live on the banana route as well (where buses come in bunches)! And we will soon have a brand new tram station. Yippee!

    Is that another post I see in the distance?

    Oh no it’s just Ash updating his rankings at last!

    Pip pip!

    • JayNovember 30, 2012 at 11:37 amReplyAuthor

      Yeah I managed to coax out the code monkey from his cage ironically enough with a banana to fix it at last! hahah.

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