Blog

Personal Loan vs Line Of Credit

Aug 9, 2021, 11:13 AM

 

Personal Loan vs Line Of Credit

 

"Metro has given us a car loan and a signature loan; we've had a couple of workout loans in the past. At every corner, Metro has had our backs. Metro is the best bank and credit union we have ever been with. If you're looking to have an account with Metro, go ahead, they will go the extra mile for you, and their staff is always very friendly." – Troy M.

 

Why are so many people in the Metro smiling? They are pleased with the personal loan and service they've received from Metro Credit Union to help pay off high-interest debt or other things like home repairs, special occasions, or unexpected expenses.

 

What is the Difference Between a Personal Loan vs Line of Credit?

 

Personal Loans

Personal loans are the lump-sum cousin of personal lines of credit. It is an all-purpose loan that is easy to acquire with a fixed interest rate using Metro's online application. If you've already dipped into your savings, it is best to borrow once you're sure of the amount you need because you can't easily borrow more. A personal loan may be the right choice if you:

  • Get a loan approval with a low rate and reasonable monthly payment.
  • Want to combine multiple bills to pay off a high-interest debt to simplify and save money.
  • Need to finance a wedding, dream vacation, or expensive home repair.
  • Commit to making the monthly payments toward the loan to protect your credit score.

 

"I have been a member since the early 70s and have never been disappointed with the service and friendly staff. I believe that my first car loan was from them, and have nothing bad to say about this wonderful, welcoming, quick-to-answer any questions when I call or stop by to ask. Super, fantastic credit union." – Gina L.

 

Debt Consolidation

Credit cards are convenient to use, but if you find yourself struggling to make multiple credit card payments each month, you might want to consider consolidating your debt. When you convert credit card debt to a personal loan, you may pay less in interest, and you have a fixed repayment period while making a single payment for multiple credit card debts. Besides paying your credit card debts, you can use any excess funds from your loan for other large purchases such as home repairs.

Register for Metro's FREE Save and Succeed resource, and you can try the debt consolidation calculator to help you analyze your financial needs. Learn more about personal loans from Metro's Save and Succeed. Fill out the quick personal loan online application today.

 

Line of Credit

A line of credit (LOC) is a preset borrowing limit that can be tapped into at any time. The borrower can take money out as needed until the limit is reached, and as money is repaid, it can be borrowed again in the case of an open line of credit. Types of credit lines include personal, business, and home equity, among others. A cash advance offers both ease and convenience to cardholders.

Before drawing down your available credit line through convenience checks or ATM withdrawals, consider the total fees and interest you owe on your credit card advance. In addition to knowing how fees are assessed and to what extent, it is recommended that you take out the full amount you need in one withdrawal not to increase costs and that you pay off the balance as soon as possible.

 

How to Protect Your Score

Your credit score is a number that indicates the level of risk of default you represent to a creditor at a given moment in time. Several scoring models are based on the FICO Score, a credit score created by the Fair Isaac Corporation, which is used in most lending decisions. It ranges from a low score of 300, representing an extremely high risk, to 850, meaning an extremely low risk. Payment history is the largest factor in credit scores so pay all your bills on time. If you need to replace your line of credit, be strategic.

If you've applied for credit recently, you may want to wait a few months because multiple applications in a short time can lower scores. Metro Credit Union has earned a reputation for exceptional personal service and great value in banking. Metro consistently receives high marks for trust, integrity, low loan rates, and better overall service. Make an appointment with a personal banker or apply for your personal loan online today.

 

"It was a pleasure working with Freddie. Thanks again for going above and beyond. We will do business with him again." - Michelle and Chris about working with Metro's Personal Banker Federico Ayon
 

Metro Credit Union- Your Local Advantage ®