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Getting the Right Personal Loan Takes Strategy, Patience, and Luck


One of the symptoms of financial long COVID is that most of the pieces of mail that arrive in your mailbox are either bills and past due notices or advertisements for personal loans.  At certain times of year, there might be the occasional holiday greeting card in the mix, but other than that, everything is a reminder of how deeply in debt you are and how much of a struggle it is to keep up with the payments.  It is no wonder that personal loans are such a popular choice.  Applying for a personal loan is a relatively simple process; sometimes it only takes a few clicks.  It is much faster than filing for bankruptcy, for example.  As with almost any apparently fast and easy financial solution, applying for a personal loan can make your financial situation worse in the long term.  The lower your credit score, the bolder lenders are about charging hefty fees, because borrowers will be unlikely to find another lender willing to offer them a less costly financial product.  Fees are unlikely to change unless you are willing to challenge them, or unless the Consumer Financial Protection Bureau (CFPB) takes action.  Interest rates, however, fluctuate for many reasons, so sometimes getting an affordable personal loan comes down to borrowing at an opportune time.  For advice about personal loans and getting out of the debt that these loans can get you into, contact a Plantation debt lawyer.

Factors That Influence Personal Loan Interest Rates

Two people with identical credit scores can borrow the same amount of money from the same lender on two different days and get two different interest rates.  These are some factors that affect the interest rates on personal loans:

  • Changes to the federal funds rate set by the Federal Reserve
  • Your credit score
  • Demand for personal loans

It is not your imagination that, for much of the past two years, the interest rates for personal loans have been high.  This is due to federal rate hikes meant to curb inflation, as well as high demand for personal loans by a financially strapped public.

If Not Personal Loans, Then What?

As of December 2023, the interest rate on personal loans is about 22 percent.  If this would lead to payments you can’t keep up with, you have some other options.  Peer to peer lending can be more affordable, but it also comes with its own set of risks.  You might also consider filing for bankruptcy protection, especially if you are considering taking out a new loan to enable you to keep up with the payments on your existing loans; discharging your debts in bankruptcy is a more effective solution.  You also might be able to renegotiate your existing loans to lower your monthly payments.

Work With a Debt Lawyer About Personal Loan Debt

A South Florida debt lawyer can help you make wise choices about personal loans and may be able to help you find alternatives to them.  Contact Nowack & Olson, PLLC in Plantation, Florida to discuss your case.



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